Chandra Shekhar Ghosh is a quintessential Bengali — he loves traditional sweets like rasgollas and sandesh, listens to Rabindra sangeet and is as big fan of Manna Dey as he is of writer Samaresh Majumdar. He’s deeply inspired by Amartya Sen’s vision of financial inclusion and it is partly that philosophy that has driven him to set up the country’s largest microfinance institution (MFI) Bandhan, that has just won approval from the Reserve Bank of India (RBI) to become a bank.
With a non-performing assets ratio of just 0.13%, Bandhan’s R6,000-crore book, comprising entirely unsecured loans, must be the cleanest in the business, and Ghosh intends to keep it that way.
The way the Bandhan chairman and managing director sees it, the biggest benefit of becoming a bank is that it will help lower interest rates for borrowers, currently at 22.9%.
Given that Bandhan borrows at 13% today from a clutch of public, private and foreign banks, it needs to lend at spreads of 1,000 basis points to be able to cover costs — especially the salaries of the 13,000-strong field force. To what extent loans will become cheaper, Ghosh is not sure yet, but he’s confident he can tap the same 55-lakh customer base to which Bandhan lends to build up a deposit base.
“Our customers do have cash surpluses from time to time, especially after they have repaid a loan. Now, they keep this money at home, but once we’re a bank, we can access it. Nearly 100% of our customers are women and they feel the need to save. Besides, there are two earning members in every family, so there is scope to raise deposits,” Ghosh explains.
He adds that the bank will also be looking to approach others in the community for deposits, aware that cost of collection will be relatively high and that the ticket sizes will be small. Once there’s a stable deposit base, the loan portfolio will be diversified — right now, it’s primarily business loans and some educational loans with an average ticket size of R10,000.
“We’re just catering to one segment of the community. When we become a bank, we intend to identify needs of other customers and lend accordingly,” Ghosh says.
Before that happens, however, the branch network needs to be in place across the 22 states where the bank will have a presence.
It’s so easy to mock Gwyneth Paltrow, but it seems wrong to kick her while she’s down. Sure, she’s impossibly pretentious — and yes, she’s seemingly oblivious to the expansive privilege that has allowed her to maintain the world’s most excruciatingly twee lifestyle. But she’s still got some genuine human feelings, and I assume it’s incredibly painful to separate from your husband and the father of your two children.
BUT GWYNETH. Why do you make it so hard for me to empathize with you? Here’s the notorious G.O.O.P. discussing her decision to take (even more of?) a sabbatical from acting, via E! Online:
“I think it’s different when you have an office job, because it’s routine and, you know, you can do all the stuff in the morning and then you come home in the evening. When you’re shooting a movie, they’re like, ‘We need you to go to…
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Outside the Vancouver Convention Centre, people gather to interact with Skies Painted with Unnumbered Sparks. Photo: Ema Peter
“It looks like it’s holding up the clouds.” “It’s like a sky jelly fish.” “I love how the light moves across it along with the sound.”
These were some of the comments heard at TED2014 about Skies Painted with Unnumbered Sparks, a collaboration between sculptor Janet Echelman and data artist Aaron Koblin. This monumental sculpture stretched 745 feet, from the Vancouver Convention Centre where TED was held, over an open-air plaza on the edge of the city’s bay and up to the top of the Fairmont Waterfront hotel. Every night during the conference, dozens of people could be seen across the street setting up cameras and tripods to capture the glowing spectacle. Meanwhile, underneath the sculpture, even greater numbers of people gathered, most of them with their phones…
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International Debt Crisis
The debt crisis of the 1980s affected all the countries. The international financial markets were severally affected when a number of developing countries found that they were unable to meet the payment amounting to several hundred billion dollars to major banks around the world. As countries trade with each other, economies are integrated. The stagnant economies in Europe and the United States had an adverse affect on many Less Developed Countries (LDC) economies. These country’s were highly dependent on their exports business on these two economies. in addition, due to the oil glut at that time, the oil exporting LDC’s were also generating less revenue.
The strengthening of the dollar during the early 1980s adversely affected the debt problems of the LDCs as most of the loans provided to LDCs were denominated in US dollars.
The interst rates in 1981 were also at their peak, exceeding 20% in 1981 infact the increased market interest rates, alogwith the strengthening of the US dollar, resulted in the effective interest rates on previous loans to be 30% or more.
Thus the international debt crisis reflected a combination of external shocks including deterioration of terms of trade and a sharp rise in US dollar interest rates and domestic imbalances such as large fiscal deficit and currency overvaluation.