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Rationales & Situational Analysis. The Bank has introduced In-Branch Cash Handling (IBCH) Process. To reduce the delay in commencing the customer cash transactions at the beginning of the day.
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The Bank has introduced In-Branch Cash Handling (IBCH) Process • To reduce the delay in commencing the customer cash transactions at the beginning of the day. • This reduces the time spent by Cash Officer/ SWO / the person dealing in cash in handing over and receiving it at the beginning of the day and at close of the day.
KYC norms have been revised by RBI • India has become member of FATF from 01st July 2010. • Based on the recommendations of FATF, RBI revises/ fine tunes the instructions regarding KYC/AML to prevent money laundering and terrorism financing . • Non Compliance leads to problems in international relations.
Branches are required to capture the details of Recovery and Cost for those ‘NPA accounts’ (irrespective of exposure) that have been closed or settled or removed from AUCA with effect from 1st April 2010 onwards. • One of the pre requisite for migration towards Internal Ratings Based approach under Basel –II for Credit Risk • To calculate Probability of Default (PD), Loss Given Default (LGD) & Exposure at Default (EAD).
Minimum Cash Balance is kept at the Branch. Why? • Cash is an idle asset and does not earn any income. • Branch has to incur higher cost on Insurance/ maintenance etc on the cash balance, if held more. • Further branch has to pay higher central office interest payable on Cash balances held at Branch.
Recently the Pay in Slips/ Withdrawal Forms have been revised • Present withdrawal slips/ pay in slips do not have features to incorporate some important data like details of remitter/ phone number etc. • Post CBS, a need is felt to revise pay-in-slips / withdrawal forms to incorporate new features such as home branch, PAN no., Contact no. of the customer etc.
A & B maintained a Savings Bank account with style of operation as –“Jointly Operated”. • Both of them had jointly given a Power of Attorney to operate the A/c to one Mr. X. • On 20th December 2010, you come to know that Mr. A has expired. • On 24th January 2011, a cheque dated 26th December 2010, signed by Mr. X is received for payment. • How will you deal with the situation?
The PoA given to Mr. X has lost its mandate after the expiry of Mr.A, a Principal. • Hence the cheque issued after the expiry of A has no mandate/authority to debit the account. • Hence the cheque must be returned stating that A/c holder-(Principal) expired.
Model Bank issued a Term Deposit in the name of Mr. X and his wife W jointly. • Mrs. W comes to the bank and request for premature payment to meet the expenses on treatment of Mr. X who is admitted to one hospital and cannot sign, because of fractured hands. • How will you deal with the situation?
Get the LTI of Mr.X and discharge from Mrs.W for payment. • The LTI of Mr.X to be obtained in the presence of two witnesses, one of whom is our Bank official. • The doctor who attends the customer Mr.X should attest Mr.X’s LTI. • Then the bank can pay the amount by pre-closure of TDR.
Mr. Akash Khanna is having his personal saving account with your Bank branch. • He is also the sole trustee of Khanna Charitable Trust and operates the account of the trust which is also maintained with the bank. • In connection with an important personal work he proposes to proceed abroad for 6 months and seeks your guidance for smooth operations in the accounts. • How will you guide him?
For his personal account- Mr. Khanna can make Power of Attorney/ Mandate in favour of some one, who is very close to & dependable by him to operate the account. • Regarding Trust account- he is only signing as a fiduciary capacity. • The power has been delegated by Trust Deed. • An delegator can not delegate further and hence for trust a/c he can not delegate to any one. • Pre signed cheques may be an option to explored with caution.
