Dear All,
Forwarding you the *Basel–3 Guidelines* released by *RBI*. *RBI releases Basel–3 Guidelines * *What the guidelines entail*: Reserve Bank of India (RBI) released the final guidelines regarding the Basel-3 norms yesterday. Amongst other details, the key point is that the banks will have to achieve a minimum Core Equity Tier-I capital adequacy (CET1) of 5% by FY2014, which in a staggered manner will then have to be increased to 8% by FY2018.* * *Immediate impact:* For 27 banks under our coverage (comprising 85% of the sector), as on FY2012 none of them are estimated to be below the immediate threshold of 5% of CET1 to be achieved by FY2014. However, in our view by FY2014, almost all banks will look to maintain a minimum CET1 of at least 8% to be comfortably above the minimum requirements. Based on this, a handful of banks including primarily a few small PSU banks like Central Bank, Vijaya Bank and UCO Bank would be the only ones that would be below the 8% threshold. This is because, for most other banks post the government infusion already announced, they are likely to be above 8% CET1 from FY2013 itself. Few others such as Corporation Bank, IOB, IDBI and United Bank would also be marginally below 8%. SBI is likely to be the only large-cap that may end up below 8% (unless their risk-weighted asset growth lags total asset growth). In case of the smaller banks, since they are trading well below 1x P/ABV, capital raising would result in dilution in EPS of 4% to 18% and in book value to the extent of 2% to 5% of our current estimates. In case of SBI, dilution would be book-accretive but EPS-dilutive. * * Kindly click on the following link to view the Report. Basel–3 Guidelines<http://emm.angelbroking.in/advisory/lt.php?id=fhpUAwxUGllVUBhUXQNWBgFKBwNLE1BTUxZYXAddQFhfJgFeWAsKTwILCQ%3D%3D> *If you have any Stock related queries, feel free to call us on 022 39357600, Extn: 6865 or mail us at **[email protected]*<[email protected]> *. For Non-Research Queries, kindly contact Feedback Team on (Area STD Code) 33551111 or mail at **[email protected]*<[email protected]> * * With best regards, Fundamental Advisory Desk Angel Broking Akruti Star,6th Floor, Road No.7,MIDC, Andheri (E),Mumbai – 93. Call : (91) (022) 39357600 Ext. 6865 Website : www.angelbroking.com<http://emm.angelbroking.in/advisory/lt.php?id=fhpfBgAeXlVVGFVcVQJXD0VVBUwXAFtcRQ1UXAZLUlB2AQtSUA5IAg4J> *Disclaimer: Ours is an advisory role. The final decision and consequences based on our information is solely yours. Moreover, in keeping with regulatory guidelines, we do not guarantee any returns on investments. Prospective investors and others are cautioned that any forward-looking statements are not predictions and may be subject to change without notice.* -- CA. Rajesh Desai -- You received this message because you are subscribed to the Google Groups ""GLOBAL SPECULATORS"" group. To post to this group, send email to [email protected]. To unsubscribe from this group, send email to [email protected]. For more options, visit this group at http://groups.google.com/group/globalspeculators?hl=en.
