STRESS SCENARIOS
Banks well capitalised to handle macro shocks
"Under the baseline scenario, the aggregate CRAR (capital to risk weighted asset ratio) of 46 major banks is projected to slip from 16.7% in March 2024 to 16.1% by March 2025," the RBI said in its June 2024 Financial Stability Report.
Big US banks withstand Fed's commercial real estate shock scenario
Amid economic uncertainties, the Federal Reserve's stress tests revealed big U.S. banks' resilience to a 40% drop in commercial real estate values. The tests underscored the challenges faced by regional banks and the need for robust risk assessment in the banking sector.
Big US banks expected to be cautious on shareholder payouts
Big U.S. lenders brace for Fed stress tests evaluating capital resilience in economic hardships, impacting returns to investors amid challenges in regional lending and commercial real estate.
View: Our cities need granular heat-risk data, hyperlocal heat action plans down to the ward level
Mungeshpur, north of New Delhi, recorded a record temperature of 52.9°C, raising concerns about urban heat stress in Indian megacities due to urbanisation, humidity, and reports from Mumbai and the Centre for Science and Environment.
Not in 'rat race' to be top builder in terms of sale bookings, says Macrotech Developers MD
When asked about the reason for setting a conservative sale bookings guidance considering that few players posted more than Rs 20,000 crore pre-sales in FY24 itself, Lodha told PTI, "We are not in any rat race and neither our shareholders are bothered about any such rat race." "We want to achieve consistent growth. Consistent growth and predictable growth with low leverage is very important and that is our business model," he said.
Mutual Fund stress tests offer valuable insights but can't be sole basis for investment decisions
Mutual funds disclose stress test results monthly for small and mid-cap schemes, estimating days to liquidate the portfolio's stocks. The tests exclude 20% illiquid securities and assess client concentration risk, AUM share, standard deviation, Portfolio Beta, and crisis impact on NAV. These disclosures fail to accurately depict stress scenarios, as they do not consider the changes in the market value of the securities in such scenarios.
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Many mid- and small-cap mutual funds have not fared well in Sebi’s stress test; Find out if your MFs are safe
Are investors drawing the right conclusions? Are some funds illprepared for a doomsday scenario? Should you buy or exit a fund based on these test results? We attempt to filter out the noise around the much-hyped stress tests to find out whether investors need to be worried.
Want to be a bit cautious now; not doing any fresh purchases: Dipan Mehta
Dipan Mehta advises caution on high valuation stocks like Tata Tech, KPIT, Tata Elxsi. He remains optimistic about IT sector triggers, avoids startup investments, and sees potential in automobile and private banking sectors. He believes the IT sector eventually will start to do much better than the rest of the market.
We encourage investors to come via SIPs with 3-5-year horizon: A Balasubramanian
ABSL AMC's A Balasubramanian emphasizes stress tests, portfolio liquidity, and SIP investments for small and midcap funds. Market liquidity, retail investors, and informed decisions play crucial roles in managing risks effectively. A Bala further says: . The current discussion, which has been there for quite some time in consultation with AMFI committee as well as Sebi, is more of a deep dive given that this segment of the market has been getting more money in the last few years."
Can your mid-cap and small-cap mutual funds handle stress?
Fearing impending volatility, Sebi has called for extensive stress tests of all mid-cap and small-cap funds.
Stress management becomes priority for engineering colleges
Colleges including the Indian Institutes of Technology, National Institutes of Technology, Birla Institute of Technology & Science and Vellore Institute of Technology are taking various steps to ensure the mental wellbeing of students.
Sebi reviewing small, midcap MFs' stress tests: Report
In talks with the Association of Mutual Funds in India (AMFI) this month, the Securities and Exchange Board of India (SEBI) asked for small and mid-cap funds' internal stress tests so it could determine if they would have adequate liquidity to meet any large outflows, the sources said.
Pre-packaged insolvency process can be potential game changer for resolving stressed assets: Shaktikanta Das
The Insolvency and Bankruptcy Board of India (IBBI) is a key institution in implementing the IBC.
Indian banks strong enough to face adverse macro and credit stress: RBI
The 28th Financial Stability Report from RBI highlighted that scheduled commercial banks have ample capital buffers, ensuring regulatory compliance even under severe stress scenarios. The report also underscored the need for suitable regulatory and supervisory measures to mitigate risks arising from the expanding use of technology and innovation in the financial system.
RBI flags contagion risk, says stress in NBFC sector assessed to be higher than in March 2023
The Reserve Bank of India (RBI) stated in its Financial Stability Report that while macro stress tests show banks would comply with minimum capital requirements under severe stress scenarios, the non-banking financial company (NBFC) sector faces higher stress relative to March 2023. The RBI emphasized proceeding with caution on the evolving outlook and risks.
Here's why the Indian Ocean could be a weak point for China in its war against Taiwan
In the context of a possible conflict with Taiwan, China's vulnerability in the Indian Ocean looms large. The passage of essential oil tankers faces grave risks, lacking adequate protection, air support, or secure bases. This weakness poses a spectrum of threats, from disrupted shipping routes to potential blockades, impacting China's crucial oil supply. Despite efforts to fortify its presence, uncertainties prevail, raising concerns about China's military capabilities in this strategic theater.
Warming, deep-sea mining cause stress in midwater animals
A recent study conducted by scientists at the GEOMAR Helmholtz Centre for Ocean Research Kiel has provided insights into the stress response of a deep pelagic jellyfish to ocean warming and sediment plumes caused by deep-sea mining. The study highlights the potential environmental disruption caused by deep-sea mining and the vulnerability of midwater species to sediment plumes. The researchers emphasize the importance of understanding the impacts of deep-sea mining on midwater ecosystems.
Stress test shows top 8 UK banks have enough capital, says Bank of England
Britain's eight largest lenders have enough capital to ride out economic stress deeper than the 2008 financial crisis, the Bank of England (BoE) said on Wednesday, as the sector faces sharply rising interest rates pummelling consumers and businesses.
India poised to sustain growth momentum, but no time to rest on laurels: Fin Min report
The comments from India's finance ministry came in an annual economic report that flagged risks in FY2024 stemming from geopolitical issues and the impact of the El Nino weather phenomenon. India's rural demand is on the path to recovery, the report said. On what is working for India’s economy, the ministry said that it sees strength in the country’s domestic demand.
Major clearing houses also pass the stress tests: RBI
Stress tests conducted at a major clearing corporation showed that the minimum required corpus of the entity's settlement guarantee fund remained unchanged and in line with regulatory requirements, according to the Reserve Bank of India (RBI). The RBI stated in its Financial Stability Report that stress testing is conducted at clearing corporations to assess the resilience of the clearing houses.
Bank of England launches first sector-wide 'stress test'
The Bank of England has launched its first sector-wide "stress test" to establish how big banks, insurers, clearing houses and investment funds collectively behave during extreme stresses in markets, it said on Monday.
VC fund General Catalyst stresses on governance in Indian startups
Instances of financial misappropriation in the last 12-18 months including at startups such as BharatPe, Zilingo and GoMechanic have prompted the venture fund to “deepen its capabilities" and collaborate more with the financial department at startups.
Reasonable targets to be fixed for SPs for overall improvement of law and order scenario: Assam CM
"Thrust will be to improve upon various indices on the law and order front and to take it to the next level in the next six months," the Chief Minister said, adding that the poor performing districts have to improve drastically if the state has to improve considerably on the law and order scenario.
Too early to predict any damage to wheat crop because of heat stress: Narendra Singh Tomar
During March 16-22 period, he said scattered to fairly widespread light /moderate rainfall has been received over Punjab, Haryana, Delhi, Uttar Pradesh and Rajasthan due to which the maximum temperatures were near normal or below normal over these parts.""In the current scenario, it is too early to predict any damage to the wheat crop due to heat stress," Tomar said.
FM Nirmala Sitharaman tells PSBs to flag stress points in business, stay alert
Finance Minister Nirmala Sitharaman has urged state-run banks to remain vigilant, stating that they should review their business models closely to identify stress points. Sitharaman has asked banks to be cautious regarding interest rates, concentration risks, and adverse exposures, and to regularly undertake stress tests.
Stress, anger & worry more common in post-pandemic era, study finds 35% Indians are unhappy
Negative or unhappy experiences are on the rise, says the study.
Russia, India ties under some stress: Russian envoy
Explaining his comments, Alipov said the western sanctions have disrupted the transaction and logistics mechanisms.The ambassador said Russia wants to further diversify its relations with India and that bilateral ties are not aimed against anyone but are for meeting the core aspirations of the two nations.
IAF chief stresses on utilising available resources to best potential
Air Chief Marshal V R Chaudhari, Chief of the Air Staff, on Friday emphasised that the IAF should derive relevant lessons from the recent geopolitical scenarios and effectively utilise all available resources to their best potential.
Four ways to stop thinking the worst will happen when you're stressed
Catastrophising comes from the belief that by imagining what might go wrong, we're better able to protect ourselves from harm – both physical and mental. However, this tendency is only helpful if you're able to correctly predict what will happen in a certain situation and how it will make you feel.
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