SBI aims for top slot in retail space

Mumbai: State Bank of India (SBI) aims to become the market leader in the retail lending space chairman Pratip Chaudhuri said on Friday. “We were never the leaders in the retail segment but have been catapulted to among the top players and would like to consolidate our position to become bigger,” Chaudhuri said at his first press conference after taking over from the erstwhile chairman OP Bhatt, on Thursday evening. The chairman hopes to retain SBI’s status as the biggest corporate lender which is evident from the fact that the corporate banking...

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Bank auditors to detail financial impact of pension & gratuity liability of PSBs

NEW DELHI: The accounting regulator has asked bank auditors to detail the financial impact of the pension and gratuity liability of public sector banks in their audit of 2010-11 accounts. The move will provide clarity on the contingent liabilities of banks, which have risen sharply after the government hiked the gratuity limit and changed pension rules. The Reserve Bank of India (RBI) has allowed banks to adjust the liability over five years. The accounting regulator has issued guidelines for treating these liabilities, but said the outgo needs...

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SBI to focus on cutting NPAs under new Chairman Pratip Chaudhuri

MUMBAI: State Bank of India's (SBI) priority will be to reduce bad loans under new chairman Pratip Chaudhuri , even as it aims to increase the share of term loans in its portfolio to improve profitability. The overall loans and deposits growth, which was lagging behind the industry , will also get the attention of the new chief who steps into the shoes of Om Prakash Bhatt, credited with shaking the slumber off SBI. Restoration of a normal relationship with the RBI is also on top of Chaudhari's agenda, after his predecessor in his aggression to...

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Air India's turnaround plan gets Bankers' nod

MUMBAI: With Air India announcing plans to become operationally profitable in four years, nearly 20 of its lenders on Friday expressed support to it indicating that they were willing to consider recasting its entire Rs 40,000-crore debt. At a three hour-long meeting here, the airline management made a detailed presentation on the plan saying it has set a target of enhancing revenues by Rs 5,000 crore and slash costs by Rs 4,000 crore per annum. Air India CMD Arvind Jadhav shared with top executives of banks details of the turnaround plan and the...

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Enam group not to float Rs 3,500 crore infrastructure fund

Vallabh Bhanshali-led Enam group has scrapped its plans to raise a 3,500-crore infrastructure fund as the sale of its investment banking and brokerage businesses to Axis Bank last year left these plans orphaned , people familiar with the developments said. Ajay Munot, head of the proposed Enam India Infrastructure Fund, has quit, said a person familiar with the development . Other senior staff at the fund-Jayesh Desai who came from consultants Ernst & Young and Pervez Umrigar, former chief executive at builders Gammon Infra-have also quit,...

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India to get details from Swiss banks by Dec

New Delhi: Switzerland today said it would be ready to conclude the double taxation avoidance agreement (DTAA) by December this year. India will then be able to get information about illegal funds parked in Swiss banks. India and Switzerland had signed an agreement on August 30, 2010 to amend the DTAA with a view to facilitating exchange of information between the two countries. “The status is that the Double Taxation Avoidance Agreement (DTAA) is in Parliamentarian process in Switzerland. We are running through this process in the next couple...

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Banks install 19,000 ATMs in FY11

In what is reflective of banks' increasing thrust on using the cheaper automated teller machines (ATM) channel for service delivery, nearly 19,000 ATMs were added last fiscal to the National Financial Switch. "The number of ATMs connected to National Financial Switch (NFS) being operated by National Payments Corporation of India (NPCI) has grown by about 19,000 in one year," a release issued here by the NPCI said. The total number of ATMs under the NFS now stands at 75,178, it said, adding, SBI and associate banks own the largest number of ATMs...

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SBI to continue amalgamation process of associates: Chaudhuri

MUMBAI: State Bank of India (SBI) new Chairman Pratip Chaudhuri today said it would continue with the policy of amalgamation of its associate banks for building scale. "The path or this course of merging associate banks would continue," Chaudhuri said in the first press meet here after assuming charge yesterday. "We did one merger every two years because we had to give more time for absorption of that network, of people in the parent bank but we are equally convinced about the need and correctness of doing that and we will pursue that," he said....

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StanChart projects 8.1% GDP growth for FY12

New Delhi: Global banking giant StanChart on Thursday projected India's economic growth to slow down to 8.1 per cent in 2011-12 in view of continuing inflationary pressure and high interest rates. In 'India Chartbook: Q1-2011' report, the banking major also said that average inflation will be 7.9 per cent this fiscal due to pressure from high commodity prices, forcing the Reserve Bank to further hike key policy rates. "Local headwinds -- inflation, higher rates and governance risk -- are likely to slow growth to 8.1 per cent in FY12 from 8.5 per...

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At 9.18%, food inflation declines to a four-month low

Food inflation fell to a four-month low of 9.18 per cent for the week ended March 26, but this may not dampen overall inflation much since it is now shifting gears to manufactured prices. This is the second week in a row that food inflation stayed in single digit as it stood at 9.50 per cent in the previous week. However, rising input costs for manufactured products may keep overall inflation at elevated level. Overall inflation rose to 8.31 per cent in February from 8.23 per cent a month ago. As such, Reserve Bank of India (RBI) is expected to...

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Foreign operations set to get a leg up at SBI

State Bank of India (SBI), the country’s largest lender, may have a managing director (MD) for its international operations. SBI now has four MDs, compared to two earlier. One of the MDs, R Sridharan, is focusing on associates and subsidiaries. Another managing director, S K Bhattacharyya, who retired in October, 2010, was the chief credit risk officer. After the Cabinet approved a Bill to amend the laws governing SBI, two additional posts of MDs were created. The government on Thursday appointed three MDs for SBI — all promoted from the posts...

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Liquidity may return to deficit zone soon

Though the easing of short-term rates and the parking of surplus funds by banks through the reverse repo (the rate at which RBI borrows money from banks) window show an improvement in liquidity, the trend may not last for long. Economists expect liquidity to return to the deficit mode by the next fortnight. “We expect LAF to once more, dip into the negative zone in the fortnight starting April 9, as the under-maintenance of cash reserve ratio (the amount of money that banks have to park with RBI) is reversed,” said economists at Kotak Economic...

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Slice of history: How IDBI came to be in 1960s

In the early 60s, when India was still battling to tackle the current account deficit and the negative industrial growth, the Reserve Bank of India decided to carve out a subsidiary that would finance the industrial development in the country. With this idea was born the Industrial and Development Bank of India (IDBI) in the year 1964. IDBI as a financial entity exceeded the expectations of not only industries but also RBI. IDBI within a decade fulfilled the role of a development finance company and expanded its base not only in the funding of...

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Rate hikes hitting business: India Inc to RBI

Mumbai: India Inc has conveyed its concerns about “the significant impact of increasing inflation and interest rate hikes on its operations” to the Reserve Bank. The RBI has hiked its key rates eight times in the last 13 months in a bid to tame the high headline inflation number. Quoting a recent study, Naina Lal Kidwai, Ficci vice president and HSBC’s country head, said a majority of the surveyed firms feel that inflation and successive hikes introduced by the RBI in the key monetary variables have started having a bearing on the industry’s performance....

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Citi's wealth mgmt service banned

London: US banking major Citigroup has been barred from selling wealth management services to new clients in Indonesia following allegations that one of its long-time employees stole money from customers, says a media report. The barring of Citi, amid allegations that a long-time employee stole millions of dollars from customers of its premium retail bank, was announced by Indonesia's central bank Governor Darmin Nasution, the Financial Times has reported. Citibank had witnessed a similar kind of scam or fraud perpetrated by a senior employee at...

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Remit2India introduces 'The Light of India Awards 2011' to recognise Indians abroad

MUMBAI: Remit2India, the online money transfer service for the NRIs, recently announced a brand new initiative to recognize the Global Indian community. Over the years, the Indian community abroad has contributed significantly not only to their country of residence but also to the Indian economy back home. Worldwide, Indians are recognized as the most valued ethnic community in terms of their intellectual capital. Their efforts in infusing capital, ideas and international practices have also contributed significantly to the Indian economy apart...

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ADB lowers growth forecast to 8.2%

New Delhi: Asian Development Bank (ADB) on Wednesday lowered its growth forecast for India to 8.2% in 2011-12, down from its earlier projection of 8.7% and lower than 8.6% expansion in previous fiscal. While slower external demand and tighter fiscal and monetary policies weigh on economic expansion, high oil prices remain a threat, the bank said in its Asian Development Outlook 2011. The report assumes international oil prices will average about $80 per barrel in 2010 and $85 in 2011. ADB projection is much lower than the 9% expansion predicted...

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PMO clears P Chaudhuri's name for SBI Chief

NEW DELHI: The Prime Minister's Office has cleared the name of Pratip Chaudhuri to head State Bank of India ( SBI ). "The requisite clearance from the Prime Minister's Office has been received ," a finance ministry official said. "The department of personnel and training will soon send the order to the finance ministry for notification." Chaudhuri is currently the managing director of SBI's international operations. He will take over from R Sridharan, CMD of Central Bank, who was given additional charge of SBI. Source: EconomicTi...

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Liquidity woes end, short-term rates slip 200 bps

MUMBAI: Short-term rates have cooled by almost 150-200 basis points as the March effect begins to wane. The fag end of the financial year is generally characterised by high pressure on short-term rates as banks build up their balance sheets. Three-month certificate of deposit rates came down to almost 8.25-8 .50% from 10.65% on March 4. Bulk deposits have also come off to 9.15-16 % from 10.5% in March when bulk deposit rates peaked. Three-month commercial paper rates also followed the trend, easing to 8.3% from 10.13% on March 23, 2011. In the...

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Banks beat RBI forecast with 21.5% loan growth in FY11

MUMBAI: Banks have exceeded the central bank's projection of 20% loan growth for the year as loans grew by 21.5% until the last reporting Friday of FY11. Deposits grew by 16.1%, lower than RBI's projection of 18% for the year, though many banks have raised interest rate on deposits over the past 3-4 months. Bank loans rose 6,98,260.56 crore, or 21.5% to 39,38,659.08 crore as of March 25, 2011, on a year-on-year basis, data released by the Reserve Bank of India showed. However, a bulk of the loans about 42%, was disbursed only in the fourth-quarter....

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Liquidity surplus banks park Rs 31,000 cr with RBI

Mumbai: The beginning of the new financial year 2011-12 has witnessed some radical improvements in liquidity scenario in the system. For the first time, almost over a year the banks have parked surplus liquidity to the tune of R31,000 crore in the reverse repo window of Reserve Bank of India. RBI's reverse repo window pays 5.75% to the banks. The rates for certificate of deposits (CDs) also softened on Tuesday. One-year CD fell by almost 30 basis points from 9.70% to 9.40% on Tuesday. Till March end, banks had been borrowing consistently from the...

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