Current Affairs - Banking

Indian Bank implemented two major customer-friendly reforms in July 2025. First, it eliminated penalties for not maintaining a minimum balance in savings accounts starting July 7, helping to expand financial access for students, senior citizens, rural families, and small business owners. Second, Indian Bank reduced its one-year Marginal Cost of Funds-Based Lending Rate (MCLR) by 5 basis points, bringing it down to 9%, effective July 3, 2025. This cut in lending rates means borrowers will benefit from slightly lower interest costs on new loans. Both measures reflect the bank’s effort to promote financial inclusion and make banking more accessible and affordable.

Mashreq, one of the leading banks in the United Arab Emirates, has become the first UAE-based bank to receive in-principle approval from the International Financial Services Centres Authority (IFSCA) to establish a banking unit in GIFT City, Gujarat, India. This strategic move aims to support international and cross-border banking, including foreign currency loans, trade finance, and risk management. Scheduled to begin operations by the end of 2025, the new branch will function as an International Financial Services Centre Banking Unit (IBU). This development strengthens financial ties between India and the UAE and positions GIFT City as a rising global financial hub.

Karnataka Bank faced a major leadership change when both its Managing Director & CEO, Srikrishnan Hari Hara Sarma, and Executive Director, Sekhar Rao, submitted their resignations citing personal reasons. Sarma plans to relocate to Mumbai, while Rao is unable to move to Mangaluru, the bank's headquarters. These resignations, effective from July 2025, come during the bank’s strategic transformation efforts aimed at digitization and operational modernization. In response, a search committee has been formed to identify new leadership, and a Chief Operating Officer will temporarily oversee operations. The development underscores the importance of succession planning in sustaining institutional momentum and investor confidence.

Punjab National Bank (PNB) took a notable step by disbursing ₹17.02 crore under its Rakshak Plus Scheme to support the families of 26 martyred soldiers and paramilitary personnel. The scheme is designed exclusively for defence and paramilitary personnel, providing comprehensive insurance benefits such as ₹1 crore for accidental death or permanent disability and ₹1.5 crore for air travel-related fatalities. PNB's initiative is not just financial in nature; it symbolizes a larger gesture of national solidarity and gratitude. The prompt and tailored support highlights the bank’s ongoing commitment to those serving in high-risk roles for the country’s safety and sovereignty.

Maruti Suzuki India has signed a Memorandum of Understanding (MoU) with Equitas Small Finance Bank to provide vehicle financing solutions, aiming to enhance accessibility and affordability for its customers. Through this strategic partnership, Equitas will leverage its extensive customer base and financial products to support Maruti Suzuki’s wide-ranging vehicle portfolio. The collaboration not only benefits potential car buyers with easier loan options but also helps both companies expand their market presence. By combining Maruti Suzuki’s automotive leadership with Equitas’s financial outreach, the move is expected to improve customer satisfaction and accelerate growth in both the automobile and banking sectors.