Three Pillars of the Basel II Accord

While Basel I framework was confined to the prescription of only minimum capital requirements for banks, the Basel II framework expands this approach not only to capture certain additional risks in the minimum capital ratio but also includes two additional areas, viz. Supervisory Review Process and Market Discipline through increased disclosure requirements for banks. The main  purpose of Basel II framework  is to create an international standard that banking regulators can use when creating regulations about how much capital banks need to put aside to guard against the types of financial and operational risks banks face while maintaining sufficient consistency so that this does not become a source of competitive inequality amongst internationally active banks.  Advocates of Basel II believe that such an international standard can help protect the international financial system from the types of problems that might arise should a major bank or a series of banks collapse. Continue reading

Bitcoin Trading Strategies for Bear Markets

Navigating bear markets in Bitcoin trading requires astute strategies to turn challenges into opportunities. In this article, we delve into  pivotal approaches: short selling, hedging with derivatives, and accumulation for long-term holding. Make sure you read this article with focus as these strategies can help you in the long run. Get all the latest news and updates at fintech-insight.com converting the world of financial market and Fintech. Short Selling In the realm of Bitcoin trading, short selling emerges as a tactical maneuver, particularly resonant in bear market scenarios. This strategy hinges on the trader’s anticipation of a decline in Bitcoin’s value, aiming to capitalize on this downtrend. The mechanism of short selling involves borrowing Bitcoin and selling it at the current market price. The crux of this strategy lies in repurchasing the Bitcoin at a lower price in the future, returning the borrowed amount, and retaining the difference as profit. Continue reading

Case Study: IBM’s Turnaround Under Lou Gerstner

“Who Says Elephants Can’t Dance” describes how Louis Gerstner lead the organizational turnaround at IBM when it was at the verge of extinction. Louis Gerstner was the chairman and CEO of IBM from April 1993 to March 2002. Before joining IBM, he had worked on various consulting assignments at McKinsey and led successful organizational changes at American Express and RJR Nabisco. During the early nineties, IBM was rapidly losing its market share in most of the markets it catered to its competitors. The management was planning to break the organization into individual businesses. Soon after his appointment as CEO, Gerstner identified that the unique competitive advantage of IBM was due to its scale and broad-based capabilities, and therefore advocated that “keeping the company together” will help IBM to utilize this unique advantage by positioning itself as software integrator. Gerstner was instrumental in shifting the mental model of employees from self-centric Continue reading

Human Resource Management and Personnel Management

Human Resource Management and Personnel Management have become a very important part of the management process in the twenty-first century, and are getting vital attention in management discussions, or in the business strategy of most organizations. Some people find Human Resource Management and Personnel Management as jargons, but to serious minded people they seem to make a lot of sense, even if there are differences of opinion. It also seems that even professional managers often differ in their understanding of the role differences between Human Resource Management and Personnel Management. Many feel that it is the same old wine in a new bottle with a different label, or that HRM is only a more modern terminology. The management philosophy was undergoing changes, and it showed that most people working not only by supervision and fear, but generally they performed better on their own if they were given the freedom of Continue reading

Types of Merger

An extensive appraisal of each merger scheme is done to patternise the causes of mergers. These hypothesized causes (motives) as defined in the mergers schemes and explanatory statement framed by the companies at the time of mergers can be conveniently categorized based on the type of merger. The possible causes of different type of merger schemes are as follows: Horizontal merger: These involve mergers of two business companies operating and competing in the same kind of activity. They seek to consolidate operations of both companies. These are generally undertaken to: Achieve optimum size Improve profitability Carve out greater market share Reduce its administrative and overhead costs. Vertical merger: These are mergers between firms in different stages of industrial production in which a buyer and seller relationship exists. Vertical merger are an integration undertaken either forward to come close to customers or backwards to come close to raw materials suppliers. These Continue reading

Industrial Finance Corporation of India (IFCI)

At the same time raw industrial units were to be set up for industrializing the country. Government of India came forward to set up the Industrial Finance Corporation of India (IFCI) in July 1948 under a Special Act. The Industrial Development Bank of India, scheduled banks, insurance companies, investment trusts and co-operative banks are the shareholders of IFCI. The Government of India has guaranteed the repayment of capital and the payment of a minimum annual dividend. Since July I, 1993, the corporation has been converted into a company and it has been given the status of a Ltd. Company with the name Industrial Finance Corporations of India Ltd. IFCI has got itself registered with Companies Act, 1956. Before July I, 1993, general public was not permitted to hold shares of IFCI, only Government of India, RBI, Scheduled Banks, Insurance Companies and Co-operative Societies were holding the shares of IFCI. Management Continue reading