Bankers Trust:

Finally, an inclusive mortgage market?

Finally, an inclusive mortgage market?

India’s roughly Rs.10 trillion mortgage market is witnessing a quiet revolution. Even though it has been growing at around 18-19% every year, the size of the market continues to be pretty small—a minuscule portion of India’s gross domestic product—but the interesting development is that around one-third of the new home loans, in terms of units, has started flowing into the low-cost housing segment, where the size of a loan is less than Rs.

Bankers Trust:

Some banks are still in hell. Some are back

Some banks are still in hell. Some are back

The dominant theme of conversation among banking sector analysts these days is whether the worst is over for India’s state-owned banks that roughly has 70% market share. I spoke to four of them last week. While two analysts say that these banks have been to hell and back, the other two are sceptical; according to them, some more pain is left for many banks.

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Raghuram Rajan is not done, yet

Raghuram Rajan is not done, yet

That the Reserve Bank of India (RBI) would not cut its policy rate in the August bi-monthly review was almost a given. To that extent, there was no surprise in the monetary policy review on Tuesday. Far more interesting than the 2,175-word review was the statement that RBI governor Raghuram Rajan read out (it was roughly one-third of the policy review, in length) at the customary press conference after releasing the review.

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Markets looking beyond Raghuram Rajan, August policy

Markets looking beyond Raghuram Rajan, August policy

The markets seem to be quite happy with the move by the Reserve Bank of India (RBI) to put licences for universal banks on tap—probably a parting gift from outgoing governor Raghuram Rajan. The chances of Rajan gifting a rate cut on Tuesday, in the last bimonthly monetary policy review before his term ends in the first week of September, are bleak, but bankers wouldn’t be complaining. A rate cut may come later this year—and could be as early as in October, in the next monetary policy announcement.