KV Kamath appointed as the chief of BRICS Bank

[anant_s]

NEW DELHI: ICICI Bank Chairman KV Kamath was on Monday appointed as the chief of the BRICS Bank. As part of the understanding, while the New Development Bank, as it will be called, will be headquartered in Shanghai, India has got the right to nominate the first president.

The proposed bank with a $50 billion capital structure is seen to be an alternative to other multi-lateral agencies with the focus on the development agenda of BRICS countries. In fact, India is looking to tap it to meet its large infrastructure financing requirement and has been an active supporter of the new entity.
On February 25, the government formally ratified India's membership of New Development Bank along with the proposed $100 billion Contingency Reserve Arrangement that can be tapped in case of a crisis. "The New Development Bank will mobilize resources for infrastructure and sustainable development projects in BRICS and other emerging economies and developing countries, to supplement existing efforts of multilateral and regional financial institutions for global growth and development," the government had said in a statement.

China is expected to make the biggest contribution, $41 billion, followed by $18 billion each from Brazil, India and Russia and $5 billion from South Africa.
KV Kamath appointed as the chief of BRICS Bank - The Economic Times

 

[third eye]

Good choice.

 

[anant_s]

NEW DEVELOPMENT BANK (BRICS BANK)

The New Development Bank (NDB), formerly referred to as the BRICS Development Bank, is a multilateral development bank operated by the BRICS states (Brazil, Russia, India, China and South Africa) as an alternative to the existing US-dominated World Bank and International Monetary Fund.

The bank is set up to foster greater financial and development cooperation among the five emerging markets. Together, the four original BRIC countries comprise in 2014 more than 3 billion people or 41.4 percent of the world’s population, cover more than a quarter of the world’s land area over three continents, and account for more than 25 percent of global GDP. The bank will be headquartered in Shanghai, China. Unlike the World Bank, which assigns votes based on capital share, in the New Development Bank each participant country will be assigned one vote, and none of the countries will have veto power.
History

The New Development Bank was agreed to by BRICS leaders at the 5th BRICS summit held in Durban, South Africa on 27 March 2013.

On 15 July 2014, the first day of the 6th BRICS summit held in Fortaleza, Brazil, the group of emerging economies signed the long-anticipated document to create the $100 billion BRICS Development Bank and a reserve currency pool worth over another $100 billion. Both will counter the influence of Western-based lending institutions and the dollar. Documents on cooperation between BRICS export credit agencies and an agreement of cooperation on innovation were also signed.

Shanghai was selected as the headquarters after competition from New Delhi and Johannesburg. An African regional center will be set up in Johannesburg.

The first president will be from India, the inaugural Chairman of the Board of directors will come from Brazil and the inaugural chairman of the Board of Governors will be Russian.

Structure and objectives
Development capital
The bank's primary focus of lending will be infrastructure projects with authorized lending of up to $34 billion annually. South Africa will be the African Headquarters of the Bank named the "New Development Bank Africa Regional Centre". The bank will have starting capital of $50 billion, with capital increased to $100 billion over time. Brazil, Russia, India, China and South Africa will initially contribute $10 billion each to bring the total to $50 billion. Each member cannot increase its share of capital without all other 4 members agreeing. This was a primary requirement of India. The bank will allow new members to join but the BRICS capital share cannot fall below 55%.

Contingent Reserve Arrangement (CRA)
The CRA is a framework for the provision of support through liquidity and precautionary instruments in response to actual or potential short-term balance of payments pressures.

The objective of this reserve is to provide protection against global liquidity pressures. This includes currency issues where members' national currencies are being adversely affected by global financial pressures.

The Bank would also provide assistance to other countries suffering from the economic volatility in the wake of the United States' exit from its expansionary monetary policy.

This fund will consist of $10 billion of "paid-in capital" ($2 billion from each member to be provided over seven years) and an additional $40 billion to be "paid upon request". Out of the total initial capital of $100 billion, China will contribute $41 billion, Brazil, Russia and India would give $18 billion each, and South Africa would contribute $5 billion. It is scheduled to start lending in 2016.

Good choice.

Indeed!
Kamath is a very respected name in Banking and financial world and i'm sure he'll bring in a lot of expertise and wealth of experience to the institute.

 

[micky]

off topic,,,,,,, ignore it

just to mention reasently INSIGHT DNA of success program started by isha foundation to help other small scall industries in india,,, and kamath is also one of the key resource leader others who are..

ramcharan
ratan tata
gmr rao
appollo reddy
Ex microsoft chairman ravi
and many big shots in india,,,,,, its going very well..... slowly indian small scale industries and large scall industries are getting connected by this program....

 

[third eye]

Indeed!
Kamath is a very respected name in Banking and financial world and i'm sure he'll bring in a lot of expertise and wealth of experience to the institute.

Years ago when he was heading ICICI I had an issue with the bank.

I wrote to him and was pleasantly surprised to receive a call and prompt reply correcting the anomaly and accepting blame.

Spoke well of him & his leadership.

 

[anant_s]

Years ago when he was heading ICICI I had an issue with the bank.

I wrote to him and was pleasantly surprised to receive a call and prompt reply correcting the anomaly and accepting blame.

Spoke well of him & his leadership.

Well thats how you build name for a brand.

 

[Chanakya's_Chant]

Raghuram Govind Rajan would have been an ideal choice though.

 

[IND151]

Raghuram Govind Rajan would have been an ideal choice though.

He is handling RBI, let him do that.

 

[WAR-rior]

Interested to see where BRICS bank stand after 10 years.

 

[Echo_419]

Raghuram Govind Rajan would have been an ideal choice though.

Let him manage RBI 1ST

 

[magudi]

Actually i predicted this on another forum a few days ago - he was seen praising modi :

Industry wrong in criticising Modi government for its woes, says KV Kamath, chairman, ICICI Bank - timesofindia-economictimes

 

[Chanakya's_Chant]

He is handling RBI, let him do that.

Let him manage RBI 1ST

We have a long list of great bankers out here who can manage the RBI - He can manage the NDB better for he already has the required international exposure and experience to deal in such international banking organizations - He has been chief economist at the International Monetary Fund - he was the one who predicted the 2008 economic crisis well before time - NDB could have benefited a lot through him than probably anyone else! He is a genius who deserves to be rewarded and be at that place.

In 2014 it was suggested that Rajan could take over from Christine Lagarde as head of the IMF when Lagarde steps down in 2016.

 

[asquare]

We have a long list of great bankers out here who can manage the RBI - He can manage the NDB better for he already has the required international exposure and experience to deal in such international banking organizations - He has been chief economist at the International Monetary Fund - he was the one who predicted the 2008 economic crisis well before time - NDB could have benefited a lot through him than probably anyone else! He is a genius who deserves to be rewarded and be at that place.

In 2014 it was suggested that Rajan could take over from Christine Lagarde as head of the IMF when Lagarde steps down in 2016.

Rajan was offered the job, he said no. As of now no one knows how the NDB is going to turn out- is it going to be professionally managed, is there going to be political interference etc. He does't want to get involved.

For him to take over as IMF MD, the IMF will have to change the tradition of always having a European MD. There's a deal between the US and Europe, the IMF has a European MD and the World Bank has an American President. They might get pressured into changing this arrangement, but I doubt it'll happen so soon.

Edit: BTW, he didn't predict the crisis. He raised concerns about how the investment banks were mismanaged and had poor incentives which discouraged ethical practices. He's a very good economist but the predicted the crisis bit is just a media creation.