What Are the International Financial Reporting Standards?

Discover how International Financial Reporting Standards provide a principle-based framework for creating transparent and comparable financial statements worldwide.

International Financial Reporting Standards (IFRS) are a unified set of accounting principles for public companies worldwide. The objective of IFRS is to create a common financial language that enhances the consistency, transparency, and comparability of financial statements, helping investors and other stakeholders make more informed economic decisions. The standards are developed by the International Accounting Standards Board (IASB), and by providing a universal framework for reporting business transactions, IFRS facilitates international investment and builds trust in capital markets.

The Conceptual Framework for Financial Reporting.

The Conceptual Framework for Financial Reporting is the theoretical foundation for IFRS. It is not a standard and does not override specific standards, but it provides the concepts that guide the IASB in developing new standards. It also helps preparers develop consistent accounting policies when no specific standard applies.

For information to be useful, it must be relevant and provide a faithful representation. Its usefulness is enhanced by comparability, verifiability, timeliness, and understandability. The framework defines the five elements of financial statements:

Asset: A present economic resource controlled by the entity.

Liability: A present obligation to transfer an economic resource.

Equity: The residual interest in the assets after deducting all liabilities.

Income: Increases in assets or decreases in liabilities that increase equity.

Expenses: Decreases in assets or increases in liabilities that decrease equity.

Governance and Standard-Setting Process.

The governance structure of IFRS is led by the IFRS Foundation, a not-for-profit corporation that provides oversight for the organization. The Foundation’s trustees are responsible for governance and strategy, including securing funding and making appointments to the standard-setting board and other bodies. The International Accounting Standards Board (IASB) is the independent body responsible for developing and publishing IFRS. It has full responsibility for all technical matters, and its members are chosen for their technical expertise and diverse international backgrounds.

The IFRS Interpretations Committee (IFRIC) assists the IASB by addressing specific application issues. When needed, the committee develops interpretive guidance that is then approved by the IASB.

Developing a new standard follows a transparent process. The IASB begins with research and consultation, then may publish a discussion paper for public comment. This is followed by an exposure draft, and after considering public feedback, the IASB issues a final IFRS Standard.

Key Principle-Based Distinctions from US GAAP.

A primary difference between IFRS and United States Generally Accepted Accounting Principles (US GAAP) is their philosophy. IFRS is a “principle-based” system with a conceptual framework, requiring professional judgment to apply standards to the substance of transactions. In contrast, US GAAP is more “rules-based,” with prescriptive and specific guidance.

One example is inventory valuation. IFRS prohibits the Last-In, First-Out (LIFO) method for valuing inventory. US GAAP, however, permits companies to use either LIFO or the First-In, First-Out (FIFO) method, which can reduce comparability between companies.

Another distinction is the treatment of property, plant, and equipment (PP&E). IFRS allows companies to revalue their PP&E to fair value, meaning the reported value can increase or decrease over time. This practice is forbidden under US GAAP, which requires these assets to be carried at historical cost less accumulated depreciation and impairment charges.

The accounting for development costs also differs. Under IFRS, certain development costs can be capitalized as an intangible asset if specific criteria are met, such as demonstrating technical feasibility. In contrast, US GAAP requires most research and development costs to be expensed as they are incurred.

Overview of Core IFRS Standards

Certain standards provide detailed guidance on specific accounting topics, translating the Conceptual Framework’s principles into actionable requirements. They dictate how transactions should be recorded and presented in financial statements.

IFRS 15 – Revenue from Contracts with Customers

IFRS 15 provides a single framework for revenue recognition using a five-step model to determine when and how much revenue to recognize:

Identify the contract with a customer.

Identify the separate performance obligations in the contract.

Determine the transaction price.

Allocate the transaction price to the performance obligations.

Recognize revenue when each performance obligation is satisfied.

Revenue is recognized when the entity satisfies a performance obligation by transferring control of a good or service to the customer, which can happen at a point in time or over time.

IFRS 16 – Leases

IFRS 16 changed lease accounting by introducing a single lessee accounting model. It requires lessees to recognize assets and liabilities for most leases on their balance sheets, eliminating the previous distinction between finance and operating leases for lessees. A lessee recognizes a right-of-use (ROU) asset and a corresponding lease liability for its obligation to make payments. Practical expedients are available for short-term leases (12 months or less) and leases of low-value assets, which can be excluded from this requirement.

IFRS 9 – Financial Instruments

IFRS 9 addresses accounting for financial instruments through a model for classification, measurement, impairment, and hedge accounting. Financial assets are classified based on the entity’s business model and the asset’s cash flow characteristics. The measurement categories are amortized cost, fair value through other comprehensive income (FVOCI), and fair value through profit or loss (FVPL).

IFRS 9 introduced an “expected credit loss” model for impairment. This forward-looking model requires accounting for expected credit losses from the moment a financial instrument is recognized, unlike the previous “incurred loss” model. The standard also includes a revised model for hedge accounting to better align with risk management activities.

Global Adoption and Application

The use of IFRS is widespread, with more than 140 jurisdictions requiring it for most domestic publicly listed companies. While many major economies have embraced IFRS, the United States requires domestic public companies to use US GAAP. However, the U.S. Securities and Exchange Commission (SEC) permits foreign private issuers to file financial statements using IFRS without a reconciliation to US GAAP.

The IASB also developed the IFRS for SMEs Accounting Standard for smaller, non-public entities. This is a self-contained, simplified version of IFRS tailored to the needs of small and medium-sized entities. The standard is less complex and has fewer disclosure requirements. The third edition of this standard was issued in early 2025 and is effective from January 1, 2027.

Prompt Corrective Action (PCA) 2017.

Bank of Maharashtra has become the sixth bank in the last one year to fall under the Reserve Bank of India’s Prompt Corrective Action (PCA). The triggering of PCA means there will be several restrictions imposed on the banks from lending to the distribution of dividends etc. These banks are Central Bank of India, IDBI Bank, UCO Bank, Dena Bank, Bank of Maharashtra and Indian Overseas Bank. 

                                                                        What is PCA?

PCA norms allow the regulator to place certain restrictions such as halting branch expansion and stopping dividend payment. It can even cap a bank’s lending limit to one entity or sector. Other corrective actions that can be imposed on banks include special audit, restructuring operations and activation of the recovery plan. Banks’ promoters can be asked to bring in new management, too. The RBI can also supersede the bank’s board, under PCA.

The provisions of the revised PCA framework effective April 1, 2017, based on the financials of the banks for the year ended March 31, 2017. The framework will be reviewed after three years.

When is PCA invoked?

The PCA is invoked when certain risk thresholds are breached. There are three risk thresholds which are based on certain levels of asset quality, profitability, capital and the like. The third such threshold, which is maximum tolerance limit, sets net NPA at over 12 per cent and negative return on assets for four consecutive years.

Here are the implications that could arise from this move:-

More banks to follow

Clearly, the rising NPAs, lower credit offtake and falling profitability have put PSBs in a tight spot. There are half a dozen PSBs that fall under the PAC.  These banks will have to very restricted lending to conserve capital, which is fast drying up because of NPA provisioning. Many will focus on fee-based income or transaction banking where capital is not required.  It is not a good news as PSBs control two third of the banking in terms of advances and deposits.

 

Pressure on government to pump in more capital

The act of RBI invoking PAC will impact these PSBs credit rating and also affect their ability to raise capital from the market. The government has limited resources to provide capital from the budget. In the last two years, the government had allocated Rs 25 crore each and the capital for the next two year is pegged at Rs 10,000 crore each. Though finance minister Arun Jaitley has said the government will infuse more if required, there is no announcement so far.  The divestment route is also not the option as the valuations of PSBs is at rock bottom.

 

Merger and acquisitions

Most of the PSBs that are falling under PAC are small and mid -sized banks with the exception of IDBI Bank. These banks are now a good candidate for the merger as they government is very keen on pushing consolidation amongst the PSBs.  There has been resistance in the past the current NDA government looks more serious. The SBI merger with associate banks was a bold one as five banks of the size of private sector ICICI Bank were merged with the parent.

 

Private sector to gain market share

The current stalemate at the PSBs is offering a big opportunity for private sector to gain market share in retail as well as corporate lending.  The private sector banks have a very comfortable capital adequacy ratio, which offers a big opportunity to them to lend. In fact, the market share of private banks remained at 14-15 per cent in the advances and deposits for a long time, but now many of these banks have the scale and also the products to expand in both retail and corporate lending.

बैंक ऑफ महाराष्ट्र पिछले एक वर्ष में रिजर्व बैंक ऑफ इंडिया के त्वरित सुधारात्मक कार्रवाई (Prompt Corrective Action (PCA)) के अंतर्गत आने वाला छठा बैंक बन गया है. PCA के ट्रिगर का अर्थ है कि बैंकों पर लाभांश आदि के वितरण के लिए उधार देने पर कई प्रतिबंध लगाए जाएंगे. ये बैंक सेंट्रल बैंक ऑफ इंडिया, IDBI बैंक, यूको बैंक, देना बैंक और इंडियन ओवरसीज बैंक हैं.

                                                                      PCA क्या है?

PCA के नियमों से नियामक को कुछ प्रतिबंधों की अनुमति मिल सकती है जैसे शाखा विस्तार को और लाभांश भुगतान रोकना. यह बैंक की ऋण सीमा को किसी एक इकाई या क्षेत्र में सीमित भी कर सकता है. बैंकों पर लगाए जा सकने वाले अन्य सुधारात्मक कार्यों में विशेष लेखा परीक्षा, पुनर्गठन कार्य और वसूली योजना के सक्रियण शामिल हैं. बैंकों के प्रमोटरों को भी नए प्रबंधन को लाने के लिए कहा जा सकता है. भारतीय रिज़र्व बैंक PCA के तहत, बैंक के बोर्ड को स्थानांतरित कर सकता है.

1 अप्रैल 2017 को बैंकों की वित्तीय स्थिति के आधार पर संशोधित PCA फ्रेमवर्क का प्रावधान 31 मार्च, 2017 को समाप्त होगा. तीन वर्षों के बाद ढांचे की समीक्षा की जाएगी.

PCA कब शुरू किया गया है?

पीसीए को तब लागू किया जाता है जब कुछ जोखिम सीमाओं का उल्लंघन किया जाता है. तीन जोखिम सीमाएं हैं जो परिसंपत्ति गुणवत्ता, लाभप्रदता, पूंजी और कुछ खास स्तरों पर आधारित हैं. तीसरी ऐसी सीमा, जो अधिकतम सहिष्णुता सीमा है, जो NPA को नेट 12 फीसदी पर और संपत्ति पर नकारात्मक रिटर्न को लगातार चार वर्ष के लिए निर्धारित करता है.

यहाँ कुछ निहितार्थ हैं जो इस कदम से उत्पन्न हो सकते हैं:-

अनुगमन करने वाले अधिक बैंक

स्प्ष्ट रूप से, बढ़ते NPAs, गिरते ऋण और मुनाफे में गिरावट ने PSBs को प्रमुख स्थान पर रखा है. PAC के तहत आधा दर्जन PSBs हैं. इन बैंकों को पूंजी के संरक्षण के लिए बहुत ही सीमित धन दिया जाएगा, जो NPA प्रोविज़निंग के कारण तेजी से कम होने वाला है, कई फीस आधारित आय या लेनदेन बैंकिंग पर ध्यान केंद्रित करेंगे जहां पूंजी आवश्यक नहीं है. यह एक अच्छी खबर नहीं है क्योंकि अग्रिम और जमा के मामले में PSB बैंकिंग का दो तिहाई हिस्सा नियंत्रित करते हैं.

अधिक पूंजी में स्पंदित करने के लिए सरकार पर दबाव

भारतीय रिज़र्व बैंक द्वारा लागू PAC का कार्य इन PSBs क्रेडिट रेटिंग को प्रभावित करना और बाजार से पूंजी जुटाने की उनकी क्षमता को भी प्रभावित करना है. बजट से पूंजी प्रदान करने के लिए सरकार के पास सीमित संसाधन हैं. पिछले दो वर्षों में, सरकार ने प्रत्येक के लिए 25 करोड़ रुपये आवंटित किए थे और अगले 2 वर्ष के लिए पूंजी के रूप में प्रत्येक के लिए 10,000 करोड़ रुपये तय किये गये है. हालांकि वित्त मंत्री अरुण जेटली ने कहा है कि यदि आवश्यक हो, तो सरकार इससे आगे बढ़ेगी, लेकिन अभी तक कोई घोषणा नहीं हुई है. विनिवेश मार्ग भी एक विकल्प नहीं है क्योंकि पीएसबी के वैल्यूएशन निम्नतम मूल्य स्तर पर है.

विलय और अधिग्रहण

PAC के तहत आईडीबीआई बैंक को छोड़कर आने वाले अधिकांश PSBs छोटे और मध्य आकार वाले बैंक हैं. ये बैंक अब विलय के लिए एक अच्छे उम्मीदवार हैं क्योंकि सरकार सार्वजनिक क्षेत्र के बैंकों के बीच एकजुटता बढ़ाने के लिए बहुत इच्छुक है. अतीत में प्रतिरोध किया गया था लेकिन मौजूदा एनडीए सरकार इसके लिए अधिक गंभीर दिख रही है. सहयोगी बैंकों के साथ एसबीआई का विलय एक साहसिक कदम था क्योंकि आईसीआईसीआई बैंक के आकार के पांच निजी क्षेत्र के बैंकों को एक मूल बैंक का साथ मिला दिया गया था.

निजी क्षेत्र का बाजार हिस्सेदारी हासिल करना

PSBs में मौजूदा गतिरोध खुदरा क्षेत्र में और साथ ही कॉर्पोरेट ऋण देने के लिए निजी क्षेत्र को एक बड़ा अवसर दे रहा है. निजी क्षेत्र के बैंकों में एक बहुत ही सुविधापूर्ण पूंजी पर्याप्तता अनुपात है. जो उन्हें ऋण देने के लिए एक बड़ा अवसर प्रदान करता है. वास्तव में, निजी बैंकों की बाजार हिस्सेदारी लंबे समय तक अग्रिम और जमा में 14-15 फीसदी बनी रही, लेकिन अब इनमें से कई बैंकों के पास खुदरा और कॉर्पोरेट ऋण दोनों में विस्तार करने के लिए पैमाने और साथ ही उत्पाद हैं.

Donald Trump to skip QUAD Summit? Report claims US President to cancel India visit

Amid the growing tensions between the US and India, Trump has reportedly cancelled his visit to India(REUTERS)

Trump has time and again claimed that he brought an end to the "war" between India and Pakistan and has alluded to using trade as leverage for both countries.

US President Donald Trump is reportedly planning to cancel his upcoming visit to India. According to a report by the New York Times, this change in plans comes amid trade tensions with New Delhi after Trump announced a 50 per cent tariff against the trading partner.

The report published on Saturday claims an India visit is no longer on Trump's agenda and the US president is likely to skip the upcoming QUAD Summit.

"After telling Mr. Modi that he would travel to India later this year for the Quad summit, Mr. Trump no longer has plans to visit in the fall," read the NYT report, citing people familiar with the US president’s schedule.

However, the report further added that the escalating tensions between the US and India can be attributed to other factors apart from trade and New Delhi's purchase of Russian oil.

As per NYT, a major source of tension between the two nations is Trump's claim that he brokered the ceasefire between India and Pakistan during their conflict in May earlier this year.

Trump has time and again claimed that he brought an end to the "war" between India and Pakistan and has alluded to using trade as leverage for both countries.

While Pakistan was quick to chime in agreement, India has denied this claim and stated that the ceasefire was established solely between New Delhi and Islamabad.

Furthermore, India has clearly stated that it does not allow any interference in its foreign relations, especially with Pakistan - a conflict which dates back over 75 years.

The report by NYT mentioned Trump's push for a Nobel Peace Prize for himself and India's refusal to acknowledge Washington's alleged role in the ceasefire has also added to the ongoing tensions.

PNB Housing board to consider Rs 5,000 crore NCD issue on Sept 5

Company to seek board nod for fund raising via NCDs in multiple tranches on private placement basis.

PNB Housing Finance said its board will meet on Friday, 5 September 2025, to consider a proposal for raising funds by issuing Non-Convertible Debentures (NCDs) of up to Rs 5,000 crore.

The fundraising may be carried out in tranches, with or without a green shoe option, through private placement. The proposal will be placed before the board for approval and necessary authorisations.

PNB Housing Finance is a deposit taking housing finance company registered with National Housing Bank (NHB). The companys asset base comprises primarily of retail home loans. The retail business focusses on organized mass housing segment financing for acquisition or construction of houses. In addition, it also provides loans against property and loans for purchase & construction of non-residential premises.

In Q1 June 2025, PNB Housing Finance's net profit increased by 23% YoY and declined by 3% QoQ to Rs 534 crore. Net interest income grew by 17% YoY and 4% QoQ to Rs 760 crore during the quarter. Net interest margin stood at 3.74% in Q1FY26 as against 3.75% in Q4FY25 and 3.65% in Q1FY25.

Shares of PNB Housing Finance fell 1.67% to Rs 753.45 on 29 August 2025.

Net interest income (NII) for the period under review was Rs 760 crore, up 17% year on year (YoY).

Net Interest Margin stood at 3.74% in Q1 FY26 compared with 3.65% in Q1 FY25. Gross Margin, net of acquisition cost, stood at 4.06% in Q1FY26.

In Q1 FY26, operating expenditure grew by 12% YoY to Rs 216 crore. Pre-provision operating profit grew by 17% YoY to Rs 632 crore. With recovery from write-off pool, Credit Cost was -27 bps in Q1 FY26 as against -7 bps in Q1 FY25.

Profit before tax in Q1 FY26 stood at Rs 687.92 crore, marking a 24.13% increase from Rs 554.18 crore in Q1 FY25.

Yield stood at 9.99% in Q1 FY26, compared to 10.03% in Q1 FY25.

Cost of Borrowing is at 7.76% in Q1 FY26 as compared to 7.92% in Q1 FY25.

Spread on loans is at 2.23% in Q1 FY26 as compared to 2.11% in Q1 FY25.

The Retail disbursement grew by 14% YoY to Rs 4,980 with Affordable segment growth at 30% and Emerging Markets segment growth at 32% in Q1FY26.

Loan asset grew by 16%YoY Rs 77,732 crore as on 30 June 2025. Retail loans grew by 18% YoY to Rs 76,923 crore as on 30 June 2025. Within Retail, Affordable Loan Asset grew by 143% YoY to Rs 5,744 crore, Emerging Markets Loan Asset grew by 20% YoY to Rs 22,701 crore and Prime segment grew by 10% YoY to Rs 48,478 crore as on 30 June 2025.

Asset under management (AUM) grew by 13% YoY to Rs 82,100 crore as on 30 June 2025.

Gross non-performing assets stood at 1.06% as on 30 June 2025 as compared to 1.35% as on 30 June 2024. Net NPA stood at 0.69% as on 30 June 2025.

Fundraise Alert: RBL Bank board clears Rs 6500 cr fundraising plan, shares gain 4%

Fundraise Alert : RBL Bank on Friday said its board has approved plans to raise up to Rs 6,500 crore through a mix of equity and debt instruments. The fundraising will include an issue of equity shares worth Rs 3,500 crore via Qualified Institutions Placement (QIP) in one or more tranches, and another Rs 3,000 crore through debt securities on a private placement basis, also in tranches.

The announcement came after market hours. Earlier in the day, RBL Bank shares ended 4.44% higher at Rs 262 on the NSE, adding Rs 11.15 from the previous close.

Earlier approvals lapsed

The private lender had earlier secured approvals for similar fundraising plans at its 81st AGM on August 7, 2024. However, those permissions expired as the bank did not tap the market during that period.

Stock performance and recent bulk deal

The fresh plan follows a strong rally in the bank’s stock over the past six months, during which it surged 60%. This compares with modest gains of 8% in the Nifty and 7% in the BSE Sensex. RBL Bank’s stock is also trading comfortably above its 50-day and 200-day moving averages of Rs 254.2 and Rs 195.2, respectively.

On Thursday, French lender Societe Generale purchased over 31 lakh RBL Bank shares worth Rs 79 crore via bulk deals at Rs 250.57 apiece, a 2% discount to the previous closing price.

Recent financial performance

For the first quarter ended June 2025, RBL Bank reported a standalone net profit of Rs 200.33 crore, down 46% from Rs 371.52 crore a year earlier. The bank attributed the decline to weaker interest income and higher expenses.

Net Interest Income (NII) slipped 13% year-on-year to Rs 1,481 crore, while net interest margin (NIM) stood at 4.50%. Operating profit fell 18% to Rs 703 crore, as unsecured lending slowed and the repo rate cut impacted earnings. Meanwhile, operating expenses rose 12% YoY to Rs 1,847 crore.

This takes the total fund infusion approved by RBL Bank's board to Rs 6,500 crore through a mix of equity and debt instruments.

Speaking about the QIP, RBL Bank said that the board has approved the plan to raise "funds by way of a Qualified Institutions Placement by means of issuance of Equity Shares (QIP) at an appropriate time for an amount upto Rs. 3,500 crore, in one or more tranche or tranches."

The raising of funds through the issuance of debt securities will also be done in one or more tranches on a private placement basis from time to time, the bank added.

The announcement was made in the post market hours of August 29. The shares of the private lender closed more than 4 percent higher at Rs 262 apiece, after Societe Generale bought nearly 33 lakh shares of the company at an average price of Rs 250.57 apiece, according to data on bulk deals available on NSE.

 Loan against shares: How it works, eligibility, documents needed

Taking a loan against shares (LAS) is a way to access liquidity without selling valuable shares. This enables investors to leverage their equity portfolio to meet immediate financial needs, such as business expansion or personal expenses.

How LAS works

Under LAS, investors may pledge their shares as collateral to secure a loan. Banks and non-banking financial companies (NBFCs) offer this service, with the loan amount usually capped at 50% of the market value of the pledged shares. The borrower can continue to retain ownership of the shares, enjoy dividends and voting rights. However, the shares are held in a demat account, with a pledge marked in favour of the lender until the loan is repaid. The loan can be structured as a lump sum or an overdraft facility, giving flexibility to the borrower.

Eligibility

Borrowers must hold shares in listed companies approved by the lender. In addition to shares, some institutions allow securities like mutual funds or bonds to be pledged.

Documentation

To be able to process the LAS request, the bank or NBFC may ask for the following documents:

KYC documents (PAN, Aadhaar).

Proof of ownership of shares or securities (demat account statements).

Proof of income (bank statements, salary slips, IT returns).

Loan terms

One of the benefits of LAS is that interest rates tend to be lower than those for unsecured loans like personal loans. The tenure for such loans varies, often between one and three years. Lenders typically offer flexible repayment options, allowing borrowers to pay monthly interest and repay the principal at the end of the tenure.

Points to note

If the market value of the pledged shares falls significantly, the lender might ask for additional collateral or partial repayment, which is termed as a margin call.

The loan amount is limited to a percentage of the portfolio's current market value.

RBI Issues June 2025 Monetary Policy Update.

RBI has announced its latest Monetary Policy today, that is 6th of June 2025, following the 55th meeting of its Monetary Policy Committee over 4th-6th June 2025. The major decisions include

Repo Rate Reduction

Policy repo rate is being reduced by 50 basis points (bps) to 5.50 per cent with immediate effect.

There will be consequent adjustment of the Standing Deposit Facility (SDF) rate under the Liquidity Adjustment Facility (LAF) to 5.25 per cent and of the Marginal Standing Facility (MSF) rate and the Bank Rate to 5.75 per cent.

With this decision RBI hopes to fulfil the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while stepping up growth momentum.

Growth Outlook

The policy notes and takes into consideration various positive and negative factors and prevailing conditions that may impact the economy in the coming months.

The report notes both positive and negative Even though uncertainty around the global economic outlook has come down a little, it remains high enough for multilateral agencies to revise global growth and trade projections downwards.

Market volatility has eased in the recent period with equity markets staging a recovery, dollar index and crude oil softening though gold prices remain high.

The National Statistical Office (NSO) vide its estimates of May 30, 2025, has shown real GDP growth in Q4:2024-25 at 7.4 per cent as against 6.4 per cent in Q3. Real Gross Value Added (GVA) rose by 6.8 per cent in Q4:2024-25. For 2024-25, real GDP growth was placed at 6.5 per cent, while real GVA recorded a growth of 6.4 per cent.

Economic activity continues to maintain the momentum in 2025-26, supported by private consumption and traction in fixed capital formation.

Investment activity is expected to improve in light of higher capacity utilization, improving balance sheets of financial and non-financial corporates, and government’s capital expenditure push

Trade policy uncertainty continues to weigh on exports prospects, however the conclusion of free trade agreement (FTA) with the United Kingdom and progress with other countries is supportive of trade activity.

Agriculture prospects remain bright on the back of an above normal south- west monsoon forecast and resilient allied activities.

Services sector is expected to maintain its momentum.

However, Spillovers emanating from protracted geopolitical tensions, and global trade and weather-related uncertainties pose downside risks to growth.

Taking into consideration the above factors the policy projects Real GDP growth for 2025-26 is projected at 6.5 per cent, with Q1 at 6.5 per cent, Q2 at 6.7 per cent, Q3 at 6.6 per cent, and Q4 at 6.3 per cent (Chart 1). The risks are evenly balanced.

Inflation Outlook

The policy notes that CPI headline inflation continued its declining trajectory in March and April, with headline CPI inflation moderating to a nearly six-year low of 3.2 per cent (year-on- year) in April 2025. Food inflation recorded the sixth consecutive monthly decline. Core inflation remained largely steady and contained during March-April.

The outlook for inflation points towards benign prices across major constituents.

Record wheat production and higher production of key pulses in the Rabi crop season, and expected above normal monsoon along with its early onset augurs well for Kharif crop prospects should ensure adequate supply of key food items. Reflecting this, inflation expectations are showing a moderating trend, more so for the rural households.

Repo Rate: The Repo Rate is the interest rate at which the Reserve Bank of India (RBI) loans money to commercial banks. More specifically, it is the interest rate at which the Reserve Bank provides liquidity under the liquidity adjustment facility (LAF) to all LAF participants against the collateral of government and other approved securities.

Standing Deposit Facility (SDF) Rate: The rate at which the Reserve Bank accepts uncollateralised deposits, on an overnight basis, from all LAF participants. The SDF is also a financial stability tool in addition to its role in liquidity management. The SDF rate is placed at 25 basis points below the policy repo rate. With introduction of SDF in April 2022, the SDF rate replaced the fixed reverse repo rate as the floor of the LAF corridor.

Marginal Standing Facility (MSF) Rate: The penal rate at which banks can borrow, on an overnight basis, from the Reserve Bank by dipping into their Statutory Liquidity Ratio (SLR) portfolio up to a predefined limit (2 per cent). This provides a safety valve against unanticipated liquidity shocks to the banking system. The MSF rate is placed at 25 basis points above the policy repo rate.

Liquidity Adjustment Facility (LAF): The LAF refers to the Reserve Bank's operations through which it injects/absorbs liquidity into/from the banking system. It consists of overnight as well as term repo/reverse repos (fixed as well as variable rates), SDF and MSF. Apart from LAF, instruments of liquidity management include outright open market operations (OMOs), forex swaps and market stabilisation scheme (MSS).

LAF Corridor: The LAF corridor has the marginal standing facility (MSF) rate as its upper bound (ceiling) and the standing deposit facility (SDF) rate as the lower bound (floor), with the policy repo rate in the middle of the corridor.

Main Liquidity Management Tool: A 14-day term repo/reverse repo auction operation at a variable rate conducted to coincide with the cash reserve ratio (CRR) maintenance cycle is the main liquidity management tool for managing frictional liquidity requirements.

Fine Tuning Operations: The main liquidity operation is supported by fine-tuning operations, overnight and/or longer tenor, to tide over any unanticipated liquidity changes during the reserve maintenance period. In addition, the Reserve Bank conducts, if needed, longer-term variable rate repo/reverse repo auctions of more than 14 days.

Reverse Repo Rate: The interest rate at which the Reserve Bank absorbs liquidity from banks against the collateral of eligible government securities under the LAF. Following the introduction of SDF, the fixed rate reverse repo operations will be at the discretion of the RBI for purposes specified from time to time.

Bank Rate: The rate at which the Reserve Bank is ready to buy or rediscount bills of exchange or other commercial papers. The Bank Rate acts as the penal rate charged on banks for shortfalls in meeting their reserve requirements (cash reserve ratio and statutory liquidity ratio). The Bank Rate is published under Section 49 of the RBI Act, 1934. This rate has been aligned with the MSF rate and, changes automatically as and when the MSF rate changes alongside policy repo rate changes.

Cash Reserve Ratio (CRR): The average daily balance that a bank is required to maintain with the Reserve Bank as a per cent of its net demand and time liabilities (NDTL) as on the last Friday of the second preceding fortnight that the Reserve Bank may notify from time to time in the Official Gazette.

Statutory Liquidity Ratio (SLR): Every bank shall maintain in India assets, the value of which shall not be less than such percentage of the total of its demand and time liabilities in India as on the last Friday of the second preceding fortnight, as the Reserve Bank may, by notification in the Official Gazette, specify from time to time and such assets shall be maintained as may be specified in such notification (typically in unencumbered government securities, cash and gold).

Open Market Operations (OMOs): These include outright purchase/sale of government securities by the Reserve Bank for injection/absorption of durable liquidity in the banking system.

 

 Top 10 Investment Banks

Many of the largest investment banks, including JPMorgan Chase, belong to the Bulge Bracket.

According to The Wall Street Journal, in terms of total M&A advisory fees for the whole of 2020, the top ten investment banks were as listed in the table below.[36] Many of these firms belong either to the Bulge Bracket (upper tier), Middle Market (mid-level businesses), or are elite boutique investment banks (independent advisory investment banks).

ank	Company	Ticker	Fees ($bn)
1.	Goldman Sachs	GS	287.1
2.	Morgan Stanley	MS	252.2
3.	JPMorgan Chase	JPM	208.1
4.	Bank of America Merrill Lynch	BAC	169.9
5.	Rothschild & Co	ROTH	94.6
6.	Citi	C	91.8
7.	Evercore	EVR	90.3
8.	Credit Suisse	CS	90.2
9.	Barclays	BCS	71.7
10.	UBS	UBS	65.9

The above list is just a ranking of the advisory arm (M&A advisory, syndicated loans, equity capital markets, and debt capital markets) of each bank and does not include the generally much larger portion of revenues from sales & trading and asset management. Mergers & cquisitions and capital markets are also often covered by The Wall Street Journal and Bloomberg.

Global market share of revenue of leading investment[37]
institutions				percentage
JPMorgan Chase			8.1
Goldman Sachs			7.2
Bank of America Merrill Lynch			6.1
Morgan Stanley			5.8
Citi			5.3
Credit Suisse			4.5
Barclays			4.3
Deutsche Bank			3.2
UBS			2.2
RBC Capital Markets			2.2
(as of December 2017)

 Core investment banking activities

Investment banking is split into front office, middle office, and back office activities. While large service investment banks offer all lines of business, both "sell side" and "buy side", smaller sell-side advisory firms such as boutique investment banks and small broker-dealers focus on niche segments within investment banking and sales/trading/research, respectively.

For example, Evercore (NYSE:EVR) acquired ISI International Strategy & Investment (ISI) in 2014 to expand their revenue into research-driven equity sales and trading.

Investment banks offer services to both corporations issuing securities and investors buying securities. For corporations, investment bankers offer information on when and how to place their securities on the open market, a highly regulated process by the SEC to ensure transparency is provided to investors. Therefore, investment bankers play a very important role in issuing new security offerings.[

Front office

Front office is generally described as a revenue-generating role. There are two main areas within front office: investment banking and markets.

Investment banking involves advising organizations on mergers and acquisitions, as well as a wide array of capital raising strategies.

Markets is divided into "sales and trading" (including "structuring"), and "research".

Corporate finance is the aspect of investment banks which involves helping customers raise funds in capital markets and giving advice on mergers and acquisitions (M&A); transactions in which capital is raised for the corporation include those listed aside.

This work may involve, i.a., subscribing investors to a security issuance, coordinating with bidders, or negotiating with a merger target. A pitch book, also called a confidential information memorandum (CIM), is a document that highlights the relevant financial information, past transaction experience, and background of the deal team to market the bank to a potential M&A client; if the pitch is successful, the bank arranges the deal for the client.

Recent legal and regulatory developments in the U.S. will likely alter the makeup of the group of arrangers and financiers willing to arrange and provide financing for certain highly leveraged transactions.

 Investment Banking.

Investment banking is an advisory-based financial service for institutional investors, corporations, governments, and similar clients. Traditionally associated with corporate finance, such a bank might assist in raising financial capital by underwriting or acting as the client's agent in the issuance of debt or equity securities. An investment bank may also assist companies involved in mergers and acquisitions (M&A) and provide ancillary services such as market making, trading of derivatives and equity securities FICC services (fixed income instruments, currencies, and commodities) or research (macroeconomic, credit or equity research). Most investment banks maintain prime brokerage and asset management departments in conjunction with their investment research businesses. As an industry, it is broken up into the Bulge Bracket (upper tier), Middle Market (mid-level businesses), and boutique market (specialized businesses).

Unlike commercial banks and retail banks, investment banks do not take deposits. The revenue model of an investment bank comes mostly from the collection of fees for advising on a transaction, contrary to a commercial or retail bank. From the passage of Glass–Steagall Act in 1933 until its repeal in 1999 by the Gramm–Leach–Bliley Act, the United States maintained a separation between investment banking and commercial banks. Other industrialized countries, including G7 countries, have historically not maintained such a separation. As part of the Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd–Frank Act of 2010), the Volcker Rule asserts some institutional separation of investment banking services from commercial banking.

All investment banking activity is classed as either "sell side" or "buy side". The "sell side" involves trading securities for cash or for other securities (e.g. facilitating transactions, market-making), or the promotion of securities (e.g. underwriting, research, etc.). The "buy side" involves the provision of advice to institutions that buy investment services. Private equity funds, mutual funds, life insurance companies, unit trusts, and hedge funds are the most common types of buy-side entities.

An investment bank can also be split into private and public functions with a screen separating the two to prevent information from crossing. The private areas of the bank deal with private insider information that may not be publicly disclosed, while the public areas, such as stock analysis, deal with public information. An advisor who provides investment banking services in the United States must be a licensed broker-dealer and subject to U.S. Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA) regulation.

Investment Bank History.

Early history

The Dutch East India Company was the first company to issue bonds and shares of stock to the general public. It was also the first publicly traded company, being the first company to be publicly listed.

Further developments

See also: History of investment banking in the United States

Investment banking has changed over the years, beginning as a partnership firm focused on underwriting security issuance, i.e. initial public offerings (IPOs) and secondary market offerings, brokerage, and mergers and acquisitions, and evolving into a "full-service" range including securities research, proprietary trading, and investment management. In the 21st century, the SEC filings of the major independent investment banks such as Goldman Sachs and Morgan Stanley reflect three product segments:

investment banking (mergers and acquisitions, advisory services, and securities underwriting),

asset management (sponsored investment funds), and

trading and principal investments (broker-dealer activities, including proprietary trading ("dealer" transactions) and brokerage trading ("broker" transactions)).

In the United States, commercial banking and investment banking were separated by the Glass–Steagall Act, which was repealed in 1999. The repeal led to more "universal banks" offering an even greater range of services. Many large commercial banks have therefore developed investment banking divisions through acquisitions and hiring. Notable full-service investment banks with a significant investment banking division (IBD) include JPMorgan Chase, Bank of America, Citigroup, Deutsche Bank, UBS (Acquired Credit Suisse), and Barclays.

After the 2008 financial crisis and the subsequent passage of the Dodd-Frank Act of 2010, regulations have limited certain investment banking operations, notably with the Volcker Rule's restrictions on proprietary trading.

The traditional service of underwriting security issues has declined as a percentage of revenue. As far back as 1960, 70% of Merrill Lynch's revenue was derived from transaction commissions while "traditional investment banking" services accounted for 5%. However, Merrill Lynch was a relatively "retail-focused" firm with a large brokerage network.

 When Are the Best Times to Trade Cryptocurrency in India?

With the understanding of global market hours and volatility, let’s discuss the best times to trade cryptocurrency for Indian traders.

1. The Best Time: Between 12 PM IST and 3 PM IST

This time period aligns with the overlap between European and US trading hours, when market activity and liquidity are at their highest. The prices of Bitcoin, Ethereum, and altcoins tend to experience more volume and price swings during these hours. Traders can capitalize on both the high market liquidity and volatility to enter or exit trades.

2. Early Morning: 5 AM IST to 9 AM IST

For Indian traders, the early morning window is another time when volatility may be heightened, as Asian markets are still active. Prices may fluctuate based on trends from China, Japan, and South Korea, giving traders opportunities to profit from local market sentiment. This window is best for short-term traders and those looking to capitalize on swift price movements.

3. Late Evening: 9 PM IST to 12 AM IST

This is when US markets are waking up, and the overlap with Indian trading activity starts. Many traders in India start engaging with the market, while at the same time, news events from the US can significantly impact market prices. If you are looking to buy or sell during a volatile period, this time frame offers ample opportunities to make gains from price fluctuations.

Best Strategies for Trading Crypto at Different Times

The timing of your trade should ideally align with your overall trading strategy. Whether you’re looking to day trade, swing trade, or hold for the long term, different trading strategies work better at different times of the day.

1. Day Trading in the US/European Overlap (12 PM IST to 3 PM IST)

If you are a day trader, the best time to place trades would be during the overlap between US and European market hours. This period is marked by high volatility and trading volume, which provides opportunities for significant profits. Day traders can capitalize on intraday price movements and exit positions quickly.

Tip: Watch for price momentum during these hours, and always use stop-loss orders to protect against unforeseen price swings

2. Swing Trading in the Early Morning Hours (5 AM IST to 9 AM IST)

Swing traders look to capture price moves over several days or weeks. The best time for swing trading in India would be during the early morning hours when Asian markets are active. This is when longer-term trends are more likely to develop, providing an opportunity to buy low and sell high.

3. Long-Term Hold: 9 PM IST to 12 AM IST

For long-term holders (HODLers), this timeframe is ideal to monitor market developments and buy the dips or sell during peaks. Long-term traders focus less on intraday volatility and more on the overall trend of the market. They should consider fundamentals like project developments, partnerships, and regulations to guide their decisions.