Table 1: Tata leads the Top 10 by a wide margin.
Source: Responses to "Can you bank on them?" Honest Truth, November 13, 2013.
The 26 applicants for the bank licenses need not wait for the official response from the Reserve Bank of India. Their fate has been decided by hundreds of readers of the Honest Truth who are clear on which groups deserve their trust - and which do not.
The overwhelming response by readers of a previous Honest Truth ("Can you bank on them?") suggests that Tata Sons is the group that a majority of people will trust their savings with. The Tata group, owners and managers of the Central Bank of India before it was nationalised by the autocratic Indira Gandhi in 1969, were clear favourites. The other groups that made the Top 10 included conglomerate L&T (number 2), Life Insurance Corporation (numbers 3), the Department of Posts (number 4) and morphed infrastructure company IDFC (number 5) which was one vote ahead of Aditya Birla Nuvo (number 6) and two votes ahead of Bajaj Finserv (number 7).
----------- When they say something's wrong, it's wrong! -----------
As per separate news reports recently...
The Chairman and CEO of PepsiCo, Indra Nooyi, observed that India had gone from being a "must-invest" country to a "must-deal-with" country.
And Karl Slym, the MD of Tata Motors also agreed that economic condition is very difficult at this moment.
So there's no doubt that things are not looking very good at the moment.
But if you want to know the real problem that YOU as an Indian are about to face really soon, we suggest you
click here and read this letter right away.
This suggests that, if only 5 licenses were to be awarded, the spot for the fifth will be a fight between the 2 large industrial groups (Bajaj and Birla) and IDFC. IDFC is a strange institution which has deviated from its original goal of being an investor in infrastructure projects and veered on a path of being an investment banker, a stock broker, and a mutual fund. All this support and help from the government and the bureaucracy only to end up as a mediocre "me-too" finance house focusing on its growth in market cap.
The people say "No"
Readers were asked to give their Top 5 - or more if they wished - choices for 2 related questions:
The tail end of the table at number 26 was crowded by 5 hopefuls: Inmacs Management Services Ltd, Magma Fincorp Ltd, Smart Global Ventures Pvt Ltd, Suryamani Financing Ltd, and Value Industries Ltd each had Zero Votes.
- Who would they keep their deposits with? and
- Who should get the banking license?
Financial hopeful Muthoot Finance managed to scrape through at 10 (with only 9% of the votes won by the winner Tata), Reliance Capital came in at number 12,
J M Financial at 14, Edelweiss at 15,
Religare at 19, and
India Infoline at 21.
Does the failure of many financial firms to make the Top 10 reflect the inherent distrust of these entities? The heavy dose of advertising these firms have undertaken in the previous decade, in addition to all the speaking opportunities their talking heads get on various TV channels, would have suggested a clear win for them compared to the boring industrial houses. Could it be that there is a perception these financial firms have failed to look after the interest of their clients in their existing businesses (where clients may have already entrusted them with a portion of their savings) and now there is a clear desire from clients not to see them win a banking license.
Interestingly a few readers were nice enough to suggest that Quantum should apply for a banking license because they trust us more than they trust anyone else! ☺ (No, SEBI, your continued desire to protect the investors in mutual funds by calibrating "seriousness" to the ridiculous proposed rule of a higher minimum "net worth" is only a way to protect the mafia that has exterminated the retail investor. But that is the topic of another Honest Truth!)
Now that the readers of The Honest Truth have had their say, it will be interesting to see what the final list drawn up by RBI looks like. Let's wait and see....
Session 7 : Ideal Asset Allocation - Released!
PersonalFN has released the 7th video on Money Simplified - Your Guide to Money & Mutual Funds.
This session guides you on how you can create an ideal asset allocation based on your investment objective, risk appetite and time horizon.
We strongly recommend you do not miss this for anything!
Click here to Watch this Free Video - Ideal Asset Allocation!
Suggested allocation in Quantum Mutual Funds (after keeping safe money aside)
||Quantum Long Term Equity Fund
||Quantum Gold Fund
(NSE symbol: QGOLDHALF)
|Quantum Liquid Fund
|An investment for the future and an opportunity to profit from the long term economic growth in India
||A hedge against a global financial crisis and an "insurance" for your portfolio
||Cash in hand for any emergency uses but should get better returns than a savings account in a bank
||Keep aside money to meet your expenses for 6 months to 2 years |
Disclaimer: Past performance may or may not be sustained in the future. Mutual Fund investments are subject to market risks, fluctuation in NAV's and uncertainty of dividend distributions. Please read offer documents of the relevant schemes carefully before making any investments. Click here for the detailed risk factors and statutory information"