Working with Emotional Attachment is Good for health

Workers who feel emotionally attached to and identify with their work have better psychological well-being, says a new study.

Efforts to increase affective organisational commitment (AOC) – the employee’s emotional attachment to, identification with, and involvement in the organisation – may lead to a happier, healthier workforce, and possibly contribute to reducing employee turnover, the study said.

Thomas Clausen from National Research Centre for the Working Environment in Copenhagen, Denmark, and colleagues looked at how AOC affected psychological well-being and other health-related outcomes in approximately 5,000 Danish eldercare workers, organised into 300 groups.

The results showed significantly higher well-being for employees in groups with higher AOC.

Groups with high AOC also had lower sickness absence rates and fewer sleep disturbances, as reported by workers.

The findings suggest that strategies aimed at enhancing employee’s emotional attachment to work might help to address the high rates of burnout and turnover among employees in healthcare and eldercare services.

The study appeared in the Journal of Occupational and Environmental Medicine.

New Base for Base Rate

Private sector lender ICICI Bank on Thursday cut its base rate by 0.35 per cent to 9.35 per cent.
The new rate will be applicable from October 5. State-run Dena Bank too reduced its base rate, or minimum lending rate, by 0.30 per cent to 9.70 per cent from 10 per cent earlier.
The new base rate will be applicable from October 5. A number of lenders, including the country's largest State Bank of India , PNB, IDBI Bank, Bank of Baroda, Bank of India and Axis Bank reduced their base rate after RBI on September 29 effected a 50 basis points cut in repo rate.
SBI, ICICI, Andhra Bank and Bank of India were among the first to cut base rate in the range of 0.20-0.40 per cent in response to RBI's surprise action.

Current Base Rate, PLR Rate and Base Rate Cut Trend of All Banks In India

Bank	Current Base Rate/PLR	Latest Update	Past Trend
Allahabad Bank Base Rate	9.95%	02nd Jun 15	Past Trend
Andhra Bank Base Rate	9.75%	29th Sep 15	Past Trend
Axis Bank Base Rate	9.50%	05th Oct 15	Past Trend
Bank of Baroda Base Rate	9.65%	05th Oct 15	Past Trend
Bank of India Base Rate	9.70%	05th Oct 15	Past Trend
Bank of Maharashtra Base Rate	10.00%	01st Jun 15	Past Trend
BNP Base Rate	9.50%	23rd Sep 13	Past Trend
Canara Bank Base Rate	9.90%	03rd Sep 15	Past Trend
Catholic Syrian Bank Base Rate	10.50%	01st Dec 11	Past Trend
Central Bank of India Base Rate	9.95%	08th Jun 15	Past Trend
Citibank Base Rate	9.35%	01st Jul 15	Past Trend
City Union Bank Base Rate	10.75%	01st Sep 15	Past Trend
Corporation Bank Base Rate	9.90%	24th Aug 15	Past Trend
DBS Bank Base Rate	9.40%	04th Mar 15	Past Trend
Dena Bank Base Rate	10.00%	08th Jun 15	Past Trend
Deutsche Bank Base Rate	9.65%	28th Jan 15	Past Trend
Development Credit Bank Base Rate	10.85%	01st Sep 13	Past Trend
Dhan Laxmi Bank Base Rate	11.50%	09th Sep 13	Past Trend
DHFL PLR	18.50%	15th Apr 15	Past Trend
Edelweiss PLR	17.50%	30th Nov -1	Past Trend
Federal Bank Base Rate	9.95%	18th Jun 15	Past Trend
GIC Housing Finance PLR	15.00%	30th Nov -1	Past Trend
HDFC PLR	16.55%	10th Apr 15	Past Trend
HDFC Bank Base Rate	9.35%	01st Sep 15	Past Trend
HSBC Bank Base Rate	9.25%	07th Sep 15	Past Trend
ICICI Bank Base Rate	9.35%	05th Oct 15	Past Trend
IDBI Bank Base Rate	9.75%	30th Sep 15	Past Trend
IIFL PLR	17.50%	01st Apr 14	Past Trend
Indiabulls PLR	17.50%	01st Dec 13	Past Trend
Indian Bank Base Rate	9.95%	08th Jun 15	Past Trend
Indian Overseas Bank Base Rate	10.05%	18th May 15	Past Trend
IndusInd Bank Base Rate	10.85%	15th Jun 15	Past Trend
Jammu And Kashmir Bank Base Rate	9.85%	01st Jul 15	Past Trend
Karnataka Bank Base Rate	10.50%	01st Jun 15	Past Trend
Karur Vysya Bank Base Rate	10.75%	23rd Jan 15	Past Trend
Kotak Bank Base Rate	9.50%	05th Oct 15	Past Trend
Lakshmi Vilas Bank Base Rate	10.95%	01st Jul 15	Past Trend
LIC Housing Finance PLR	14.50%	01st Oct 13	Past Trend
Nainital Bank Base Rate	10.00%	01st Jul 15	Past Trend
OBC Base Rate	9.70%	30th Sep 15	Past Trend
PNB Base Rate	9.60%	01st Oct 15	Past Trend
PNB Housing Finance PLR	14.35%	27th Apr 15	Past Trend
Punjab and Sind Bank Base Rate	10.00%	02nd Jun 15	Past Trend
Ratnakar Bank Base Rate	10.85%	15th May 15	Past Trend
Reliance Capital PLR	18.25%	01st Dec 11	Past Trend
SBBJ Base Rate	9.95%	18th Jun 15	Past Trend
SBI Base Rate	9.30%	05th Oct 15	Past Trend
South Indian Bank Base Rate	10.20%	01st May 15	Past Trend
Standard Chartered Bank Base Rate	9.75%	07th Aug 14	Past Trend
State Bank of Hyderabad Base Rate	9.95%	16th Jul 15	Past Trend
State Bank of Mysore Base Rate	9.95%	18th Jun 15	Past Trend
State Bank of Patiala Base Rate	9.95%	08th Jun 15	Past Trend
State Bank of Travancore Base Rate	10.15%	16th Mar 15	Past Trend
Syndicate Bank Base Rate	10.00%	08th Jun 15	Past Trend
Tamilnad Mercantile Bank Base Rate	10.60%	01st Jun 15	Past Trend
UCO Bank Base Rate	9.95%	01st May 15	Past Trend
Union Bank of India Base Rate	10.00%	27th Jan 15	Past Trend
United Bank of India Base Rate	9.90%	19th Jun 15	Past Trend
Vijaya Bank Base Rate	10.00%	01st Jun 15	Past Trend
Yes Bank Base Rate	10.25%	05th Oct 15	Past Trend

Who sets the base rate? Do banks set their own base rate or is it set by the RBI? What determines a bank’s base rate?

• Each bank decides its base rate from time to time
• The RBI does not mandate or decide the base rate of any bank or NBFC or HFC
• A bank’s base rate or PLR is determined based upon its cost of raising funds or deposits and a minimum margin that it must apply to cover its cost of operations and credit risk. However, a bank can have only one base rate for all its customers at a time
• When pricing a loan, the bank may add customer specific or product specific spread or margin to the base rate to arrive at its lending rate

How does base rate vary over time? How do interest rates on base rate benchmarked loans change over time?

• Banks are free to revise their base rate any number of times.
• In order to avoid too frequent changes to applicable interest rate on base rate benchmarked loans, RBI has specified that interest rate applicable on all such loans be revised at the beginning of every quarter to give effect to changes made to the base rate during the previous quarter

Small denomination notes and the background

The demand for bank notes and coins is increasing notwithstanding the use of technology driven non-cash modes of payments.India is the largest producer and consumer of currency notes, next only to China.Currency continues to be the dominant means of payment especially among the lower and middle class. 

In the recent past, it has been observed that volume/value of notes in circulation was adequate, but the real issue is inadequate small notes/coins. Very often, shopkeepers pay back the balance of Rs 1 to Rs 5, for the cash purchases, in “chocolates” or even compel the public to buy any other item since they do not have small denomination notes/coins. Inadequacy of smaller denomination notes/coins coupled with lack of sufficient distribution mechanism multiplies the problems faced by the public.

As on March, 2015 the value of notes in circulation increased to Rs 14,289 billion with a yearly  growth rate of 11.4 per cent and the volume increased to 83.6 billion (growth - 8.1 per cent). That’s may be good enough. However, share of higher denomination notes (Rs 500 and Rs 1,000) is increasing consistently and as on March, 2015 they constituted about 85 per cent in terms of value.
Even in terms of volume, over the two years, the share of Rs 2 to Rs 100 (smaller denomination) has come down from 79.5 per cent to 77.6 per cent, though there is an absolute increase in its volume.

While the total value of coins in circulation increased by 12.1 per cent, in volume terms the increase was 8.0 per cent. In short, the authorities are focusing on the need to meet the total demand for currency notes with higher denomination currencies.

The demand for currency is estimated based on GDP growth prospects, inflation and disposal of soiled/mutilated notes. Effective mechanism put in place coupled with incentives provided to the banks has resulted in disposal of around 15.1 billion pieces of soiled notes during FY 14-15, 0.90 billion more than the previous year. The number of counterfeit notes detected has increased to 5.94 lakh pieces (maximum Rs 500 notes – 2.74 lakh, followed by Rs 100 – 1.82 lakh and Rs 1,000- 1.31 lakh).

In tune with the international practices of not having multiple series of notes simultaneously in circulation, the RBI initiated the process in 2014 of withdrawing notes issued before the 2005 MG series having fewer security features. Also, majority notes have been withdrawn and the final date for withdrawal has been fixed as December 31, 2015.

Certain initiatives like linking shopkeepers / business establishments, toll gate agencies etc to the nearest currency chests for their requirements of coins, organising “Coin Melas” by banks to issue coins directly to the public, establishing coin vending machines by banks to provide coins to public etc are the steps in the right direction, but grossly inadequate.

Equitable distribution

Needless to say, there should be adequate channels for equitable distribution of the notes and coins. Currency chests of the banks and small coin depots are the main channels for distributing the new notes and siphoning of soiled/mutilated notes back to the RBI. In spite of more freedom and incentives provided by the RBI to banks in opening of currency chests, their number is coming down.

On account of prohibitive cost of opening/maintaining currency chests, banks are very reluctant to open new chests and are closing down the existing unviable chests.

The number of chests has come down from 4,426 in 2005 to 4,132 (2015) and small coin depot/sub depots from 4,048 (2005) to 3,813 (2015). The achievement of the objectives of Clean Note Policy is possible only with rapid increase in number of currency chests.

Many banks are now levying heavy service charges on cash deposits basically to dissuade inflow of bulk cash as bank branches do not have adequate disposal mechanism. It is high time to re-look on the need for rapid expansion of number of currency chests.

We can even adopt a kind of while label currency chests, in line with white label ATMs put in place in the recent past, and attempt for increasing the number of currency chests. These white label currency chests can levy fees for the services they render on cost-plus basis and will have wide acceptability.

The regulators are fully awa-re of the issues connected to cu-rrency management. The RBI largely imports the main ingredients required for printing currency. India produces only 5 per cent of the paper required for currency note printing.

Dependence on imports makes the printing process of currency vulnerable in terms of price, quantity and timeliness. “Make in India” is perhaps right step to resolve the issue connected to inadequate currency notes in circulation and the consequent difficulties faced by the common man.

(The writer is a retired public sector bank executive teaches banking in ICICI Manipal Academy (IMA), Bengaluru Mr.K.N.V. Prabhu)