Bank of Maharastra

Global crisis with Indian scenario and banking products

Guest of the day :- Mr. Vilas Ranavade , 19th March,10:30 am

Neville Wadia Hall

About Mr. Ranavade

Mr. Vilas Ranavade has been a respected banker for the last three decades. He has been the branch head of corporate and overseas banks. He is presently a consultant at the Bank of Maharashtra, Dhole Patil road

He has won many accolades and recognition in his banking career. He is also a visiting faculty at the State Bank of India, Suryadutta college and many other banks and colleges where he gives lectures relating to banking.

The topic was “Global crisis with Indian scenario and banking products”

Global crisis

What sparked off the global crisis?

He explained us the reason for the crisis that took place and recession that followed. The first reason is the subprime crisis. Subprime in Indian scenario means where the borrowers are the top class people and in US it means where the borrowers are economically backward people. In USA there is one bank and one branch, there are not many branches spread across the nation like in India. In USA the products are outsourced. They kept lending money. They did not keep a cash reserve ratio of 12.5%. The Americans are dependent on other nations for their products and vice-versa especially Japan. There was continuous appreciation of value of goods. The banks were not capitalised. Continuous appreciation led to no money and no exports.

The second reason is loose policy. Artificial demand was created for more houses. In USA bank dismissed for more mortgage loan. When demand increased, the supply also increased. There came a point where the supply exceeded demand and this led to more problems. At that point only Bank of America and Bank of New York, Milan survived. Other banks were not capitalised. Due to more withdrawal, the appreciation of dollar went up. The price of petrol and diesel increased. This led to increases in prices of all...