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Journalism of Courage
Banking: It8217;s going to be most keenly watched sector. Will the government announce the much-awaited reforms ignoring stiff opposition from the Left?
Buzz in the sector
8226; The FDI limit in banks is likely to be raised from 49 to 74.
8226; A hike in the 10 ceiling on voting rights in banks is expected.
8226; Tax incentives on mergers and acqusitions by banks are on the anvil.
WHAT I DON8217;T EXPECT IN BUDGET 2005
I don8217;t expect any substantial major changes in the banking sector. But the government may allow banks and mutual funds in the commodities market and hike equity exposure.
8212; Ravikumar, MD, NCDEX and director, Federal Bank
The income-tax benefit for housing loans may not be disturbed to maintain the growth momentum in the sector.
8212; Cherian Varghese, chairman 038; MD, UBI
A level-playing field is needed between the rate on public savings and the 9 per cent rate on senior citizen savings. This is expected but am not sure if that will be done.
8212; S C Gupta, CMD, Indian Overseas Bank.
BUDGET RECAP 2004
8226; Double credit to the agriculture sector in the next three years.
8226; A task force to explore reforms in the cooperative banking sector.
8226; Amendment of Securitisation Act was announced and implemented later in the year.
PERFORMANCE SNAPSHOT
Despite a fall in treasury income, banks have been churning out higher profits 20 per cent plus in the last two years. The fall in interest rates boosted credit delivery. Bad loans declined. Bank shares also shot up on the stock exchanges.
