19
Thursday
July 2018
1:12 AM IST
News Headlines
Bolt poised for surprise trial with Aussie football club        Iceland coach steps down after 7 years in charge        Govt doubles import duty on over 50 textile products        Walmart partners with Microsoft for cloud solutions        Official: 54 released from Taliban prison in Afghanistan        Putin: US-Russia ties should not be held hostage to Mueller probe        Two dead, 3,500 relocated as rains lash parts of Gujarat        LJP raises Dalit issues in all-party, NDA meetings        SC asks Parliament to consider new law to deal with mob lynching        Court's duty to strike down law if it violates fundamental right: SC        After Kohli, assistant coach Bangar comes to Dhoni's defence        France set for heroes' welcome after thrilling World Cup win        Niti Aayog working on proposal to replace LPG subsidy with cooking subsidy: Kumar        May announces new 2 bn pounds UK-Italian fighter jet project        Russia targeted by almost '25 million cyber-attacks' during World Cup: Putin        Afghan official: Taliban kill 7 police in eastern province        Trump and Putin open historic summit        From April next year, national database for gun licence holders        SC refuses to stay new rules on health warning for tobacco products        CBI chargesheets Farooq Abdullah, three others in JKCA scam        
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Business News
RBI scraps bank LoUs in the aftermath of PNB fraud
 
(NEW DELHI, Mar 13, 2018):In what seems like a direct fallout of the multi-crore PNB scam involving jewellers Nirav Modi and Mehul Choksi, the Reserve Bank of India (RBI) on Tuesday discontinued issuance of Letters of Undertaking + (LoUs) by banks for trade credits for imports into India. The move will come into effect immediately, the central bank said in a statement.

To recap, Punjab National Bank reported fraudulent issuance of LoUs/ Foreign Letters of Credit for payment of import bills and fraudulent transactions in accounts, amounting to Rs 12,967.86 crore, to the RBI through its fraud monitoring reporting system.

LoUs are bank guarantees + under which a bank allows its customer to raise money from another Indian bank’s foreign branch in the form of short-term credit. The loan is used to make payment to the customer’s offshore suppliers in foreign currency. The overseas bank usually lends to the importer based on the LoU issued by the importer’s bank.

The central bank's move may hit businesses which are dependent on imports, who are often reliant on LoUs to get bank guarantees.

The RBI notification further said that Letters of Credit and Bank Guarantees for trade credits for imports into India may continue to be issued subject to compliance with the provisions.

Incidentally, on Tuesday, Finance Minister Arun Jaitley in a written reply to the Rajya Sabha said that Nirav Modi obtained his first fraudulent guarantee from PNB's Brady House branch in Mumbai on March 10, 2011 and managed to get 1,212 more such guarantees over the next 74 months.


Govt doubles import duty on over 50 textile products
Walmart partners with Microsoft for cloud solutions
Niti Aayog working on proposal to replace LPG subsidy with cooking subsidy: Kumar
May announces new 2 bn pounds UK-Italian fighter jet project
Mukesh Ambani beats Alibaba's Jack Ma to become richest man in Asia
Rupee up 19 paise against dollar ahead of key macro data release
Sensex rallies 400 pts to hit record high; RIL shares surge 5%
US dollar ends cheaper against rupee
BSNL starts first internet telephony service in India
Silver futures harden by 0.19% on global cues
Passenger vehicle sales rise 38% in June; car sales up 34%
DoT clears Idea-Vodafone merger with conditions
Goyal asks Coal India to ensure supply for power sector
Higher MSP may have inflation, fiscal costs: Report
Modi govt needs to shed 'obsession' with economic growth: Jean Dreze
Will work closely with West Bengal for its progress: Prabhu
Mukesh Ambani announces high-speed broadband, Jio Phone 2 with WhatsApp, FB
Gadkari flags off taxi ambulance services
India expecting US to get in touch with it over sanctions on Iran
Nifty ends higher, hovers around 10,700-mark
KERALA NEWS
Kerala among 13 states on thunderstorm alert
 (New Delhi, May 7, 2018): Thunderstorms accompanied by squall, hail and heavy rains are likel  
Kerala Karshaka Jadha Opens to a Great Beginning / Video
Malappuram press club attack: RSS workers nabbed
Workers injured in mudslide at construction site
INTERNATIONAL NEWS
Official: 54 released from Taliban prison in Afghanistan
 Kabul, Jul 17 (AP) An Afghan official says at least 54 people, including security personnel and civi
Putin: US-Russia ties should not be held hostage to Mueller probe
Russia targeted by almost '25 million cyber-attacks' during World Cup: Putin
Afghan official: Taliban kill 7 police in eastern province
NATIONAL NEWS
Two dead, 3,500 relocated as rains lash parts of Gujarat
 Rajkot/Ahmedabad, Jul 17 (PTI) Two persons, including a school boy, drowned as incessant rains lashe
LJP raises Dalit issues in all-party, NDA meetings
SC asks Parliament to consider new law to deal with mob lynching
From April next year, national database for gun licence holders
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