A wake up call

With reference to ‘End the problem of dual control of PSBs: YV Reddy’ (August 24), it goes without saying that the former RBI Governor hits the nail on the head when he bats for putting an end to the problem of “dual control” of public sector banks. He also goes on to add that PSBsshould be ‘reorganised’ as entities under Companies Act, duly licensed by the RBI as a bank.

Interestingly, Dr Reddy, at a recent lecture addressed another contentious issue between the present RBI Governor Urjit Patel and the govt over the extant powers enjoyed by the central bank to regulate the public sector banks which the govt considers to be adequate to serve the real purpose.

However, Dr Reddy must be complimented for his critical yet realistic assessment of the two aspects concerning the regulation and supervision of the banks — governance and prudential regulation by categorically pointing out that the RBI regulates both governance and prudential aspects of private sector banks but the government exercises all the powers relating to governance, leaving prudential regulation to RBI in the case of public sector banks. It should serve as a wake up call for the government to put its own house in order.

Panchkula (Haryana)

With reference to “Kerala floods: Man-made or nature’s fury?” (August 24), the devastation endured by Kerala may be ascribed to man-made atrocities on the Western Ghats to a large extent and nature’s fury to some extent. Playing with the nature is like playing with the fire. Ignoring experts’ advice seems to be ingrained in the people in power.

It is time the power dispensation learnt from the mistake to prevent such devastation from occurring in future.

Bengaluru

Battered by an unprecedented floods which left a trail of huge devastation and loss of several human lives, Kerala is desperately in need of huge financial assistance from both within and abroad to help its people rebuild lives and reconstruction of damaged infrastructure. Considering the groundswell of public opinion in favour of facilitating foreign aid for Kerala, the Union government needs to adopt more flexible and pragmatic stance and gracefully accept the offer of assistance for Kerala without any delay.

Sholavandan (TN)

With reference to the editorial “Systemic risk”, published in the edition of August 21, which states:

“In the case of Cosmos, the fraudsters had developed a proxy switch that bypassed all these checks and authorised fraudulent transactions. The SWIFT system — a messaging network for securely transmitting instructions for financial transactions — was also compromised to transfer money fraudulently to banks outside.”

However, SWIFT has no indication that its network and core messaging services have ever been compromised – it is really important to be clear on that point.

What we have seen in previous incidents is that customers suffer security breaches within their local environments. Once the attackers have targeted and compromised their environments, they go on to exploit vulnerabilities in banks funds’ transfer initiation environments – they steal credentials, create fraudulent messages and initiate the funds transfer process, by sending messages over the SWIFT network.

Similarly, later in the editorial there is a line saying: “Earlier this year, City Union Bank’s SWIFT had come under attack, and nearly $2 million was transferred to three banks abroad.”

Again, it is not SWIFT that has come under attack, rather banks that are connected to the SWIFT network.

Deputy Head of Corporate Affairs, SWIFT

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