RBI to interview all 7 EDs for Dy Guv job

Deputy Governor Shyamala Gopinath retires on June 20. The government has started the process to identify a replacement for Shyamala Gopinath, deputy governor of the Reserve Bank of India (RBI) who retires on June 20. A search committee headed by Governor D Subbarao has called all seven executive directors of the central bank for interviews on May 13. To be eligible, a candidate should have two years of residual service. mong the seven executive directors, V K Sharma is the seniormost, followed by V S Das. The other executive directors are G Gopalakrishna,...

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Kotak Bank March qtr PAT up 17% at Rs 491 cr

Private lender Kotak Mahindra Bank today posted a 17% rise in consolidated profit after tax (PAT) at Rs 491 crore for the three months ended March 31, 2011. The bank had a PAT of Rs 419 crore in the same period an year-ago, Kotak Mahindra Bank said in a release. Total income rose to Rs 3,027.78 crore in the latest quarter as compared to Rs 2,945.31 crore in the same period last year.The consolidated PAT for 2010-11 of the bank stood at Rs 1,567 crore, up 20% from 2009-10. The bank has declared a dividend of Rs 0.50 per share with a face value Rs...

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Andhra Bank hints at increasing lending rates

HYDERABAD: Public sector lender Andhra Bank on Thursday hinted that it would increase lending rates after the Reserve Bank's move to up its key policy rates. R Ramachandran, Chairman & Managing Director, Andhra Bank said there will be some pressure on net interest margins (NIM) with the RBI's decision going forward. NIM is the difference between interest earned and interest paid by the bank. Andhra Bank has registered a net profit of Rs 1,267 crore for the fiscal ended March 2011 as against Rs 1,046 crore in the previous fiscal. The total...

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BoB, Dena Bank, BoI raise base rates, BPLRs by 0.5% each

MUMBAI: Lending rate hikes by banks, which began after the Reserve Bank raised repo rate by 0.5 per cent to 7.25 per cent on Tuesday, continued on Thursday with three leading public lenders upping both their base rates and BPLRs. Bank of Baroda , Bank of India and Dena Bank upped their base and benchmark prime lending rates (BPLRs) by 0.5 per cent each with effect from tomorrow, they said in separate statements here today. Accordingly, BoB's base and BPLR will stand at 10 per cent and 14.25 per cent, respectively. Dena Bank's base rate has been...

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Banks report fall in biz; loan amount down by Rs 37.407 crore, deposits by Rs 5521 crore

MUMBAI: The window dressing effect on bank balance sheets has started to wear off, with banks showing an across-the-board dip in business. According to the latest RBI release , loans extended by commercial banks in the country dipped Rs 37,407.0 crore during the fortnight ended April 22 to Rs 3,919,000.5 crore. This is the first fortnight which captures all the days in the current fiscal . Total deposits dipped by Rs 5,521.2 crore to Rs 5,319,431.5 crore. Term deposits went up by Rs 36,240.9 crore while demand deposits dipped by Rs 41,762.1 crore....

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PNB Q4 profit up 5.8% to Rs 1,201 cr

New Delhi: Country's second largest public sector lender Punjab National Bank posted a 5.8 per cent increase in net profit at Rs 1,201 crore for the three months ended March 2011. The bank had a net profit of Rs 1,135 crore in the same period a year-ago, PNB said in a statement. Total income rose 31.2 per cent to Rs 8,586 crore in the latest quarter compared to Rs 6,460.7 crore in the same period last year. For the full year ended March, the lender reported a net profit of Rs 4,433 crore, representing an increase of 13.5 per cent, as against Rs...

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Bank of Maharashtra raises interest rates by 50 bps

State-run lender Bank of Maharashtra said on Wednesday it has raised its base rate and benchmark prime lending rate by 50 basis points each to 10% and 14.25% respectively, effective May 5. On Tuesday, the Reserve Bank of India raised interest rates by a sharper-than-expected 50 basis points, and said fighting inflation was top priority, even at the expense of short-term growth. Source: Business Stand...

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RBI raises m-wallet limit to Rs 50,000

New Delhi: Relaxing the norms for making payments using mobile phones, known as m-wallet, the Reserve Bank today decided to increase the limit of money-loading to Rs 50,000 from the existing limit of Rs 5,000. "The maximum value of such prepaid semi-closed m-wallet shall not exceed Rs 50,000," a RBI notification said. Leading mobile operators Bharti Airtel and Vodafone had tied up with SBI and ICICI Bank respectively to offer such facilities to their subscribers. The central bank has also decided to treat semi-closed mobile wallet on par with the...

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Oriental Bank raises base rate, BPLR by 50 bps each

MUMBAI: State-run lender Oriental Bank of Commerce said on Wednesday it has raised its base rate and benchmark prime lending rate by 50 basis points each to 10 percent and 14.25 percent, respectively, effective May 5. On Tuesday, the Reserve Bank of India raised interest rates by a sharper-than-expected 50 basis points, and said fighting inflation was top priority, even at the expense of short-term growth. Source: EconomicTi...

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Lenders begin to hike rates; PNB, YES Bank raise base rate & PLR by 50 bps

MUMBAI: Taking a cue from the Reserve Bank of India, commercial banks and housing finance companies have started raising lending rates. Just a day after the central bank raised key policy rates and the savings bank account rate , Punjab National Bank and YES Bank increased lending rates for existing and new customers while LIC Housing Finance hiked rates for new customers. PNB and YES Bank raised their base rate and prime lending rate by 50 basis points. One basis point is 0.01 percentage point. With the latest rate revision, PNB's base rate would...

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NBFCs will need 150-cr net-owned funds for PD entry

MUMBAI: The Reserve Bank of India has said non-banking finance companies (NBFCs), who intend to get into primary dealership business, should have minimum net-owned funds, or NOF, of Rs 150 crore. Banks who intend to expand to primary dealership business should have a minimum net worth of Rs 1,000 crore. Primary dealers, or PDs, are specialised traders in government bonds who have the market making mandate for government bonds and offer two-way quotes on bond trading. The revised guidelines, put up on RBI's website, have also said, in case a primary...

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RBI tightens provisioning norms

The Reserve Bank of India (RBI) on Tuesday increased the provisioning requirements on certain categories of non-performing assets and restructured loans. Bankers, however, said the additional provisioning was unlikely to stress their earnings in coming quarters. “In April 2011, banks were advised to segregate the surplus of provisions under the provision coverage ratio (PCR) vis-à-vis what was required as per prudential norms as on September 30, 2010, into an account styled as counter-cyclical buffer,” RBI said in its monetary policy statement...

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RBI to extend short sale period of G-sec to 3-months

Mumbai: The Reserve Bank of India said that it has proposed to extend the period of short sale in the Central Government securities from the present five days to the maximum of three-months. The move will provide a fillip to the interest rate futures market and the term repo market, the Reserve Bank said in its monetary policy statement for FY 12. Intra-day short selling in Central G-sec was permitted in February 2006 based on the recommendations of the Technical Group on the Central Government Securities Market. In January 2007, based on the feedback...

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RBI abandons 'baby steps' to tackle inflation

From ‘baby steps’ to a significantly ‘large step’ was the Reserve Bank of India’s (RBI) answer to inflation. The rise in policy rates (repo rate) by 50 basis points to 7.25 per cent signalled aggression to tackle inflation, which the apex bank has projected at six per cent with an upward bias for March 2012. Thus, there is a readiness to sacrifice growth to tame elevated inflation pressure, especially for the next two quarters.RBI Governor D Subbarao, elaborating the stance of the Monetary Policy for 2011-12, said, “RBI will work to control demand...

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Banks told to set aside more funds for bad, restructured loans

MUMBAI: The Reserve Bank of India (RBI) has asked banks to set aside more money for bad and restructured loans , a move which will impact their overall cost and has come as a surprise to most bankers. Higher provisions for bad loans comes within a week of the central bank doing away with mandated 70% provision coverage ratio (PCR) norm. SBI chairman Pratip Chaudhuri said, "This comes as a relief. Overall this is a more prudential provisioning requirement and more aligned to international practices." Among the major changes, banks will now have...

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Now, banks can invest 10% of networth in MFs

To stop the circular movement of funds between banks and debt-oriented mutual funds (DoMF), the Reserve Bank today limited bank investment in liquid schemes of such funds at 10% of their net worth. "The investment in liquid schemes of DoMFs by banks will be subject to a prudential cap of 10% of their net worth as on March 31 of the previous year," the Reserve Bank said in its 'Monetary Policy Statement for 2011-12'. The RBI said that same money was circularly moving between the banks and the DoMFs, which could potentially lead to systemic risk.It...

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Savings bank deposits to fetch more

Mumbai: Interest rate on the money lying in savings bank accounts will go up by half a percentage point, with the Reserve Bank deciding to hike it to 4 per cent. The deposit-holders in the savings bank (SB) were receiving the rate fixed eight years ago. However, the move will raise the cost of borrowing for the banks which leverage high on the 'Current Account, Savings Account'(CASA) funds. The CASA deposits are much cheaper than the time deposits, where the going rate for six-months and above is about 8 per cent. Unlike the time deposits, the...

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RBI hike: Home buyers to pay 'penalty'

New Delhi: Housing prices could go up, as the borrowing cost for developers is set to increase following the hike in short-term lending rates by the RBI, industry body CREDAI said today. The RBI's decision to hike key rates - lending (repo) and borrowing (reverse repo) rates by 50 basis points to 7.25 per cent and 6.25 per cent respectively - will raise the cost of home, auto and other loans. It was reacting to the news that the reserve Bank of India (RBI) in its credit policy meet had hiked key rates by 50 bps to India's largest realty firm DLF...

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IDBI Bank hikes rates by up to 50 bps

New Delhi: State-owned IDBI Bank today raised lending and deposit rates by up to 50 basis points soon after the Reserve Bank's monetary policy action, a move likely to be followed by other lenders in the coming days. In response to increase in cost of funds and keeping in view the market conditions, the bank has decided to increase both base rate and Benchmark Prime Lending Rate (BPLR) by 50 basis points each, IDBI Bank said in a statement. With the increase, base rate or the minimum lending rate will be 10 per cent and BPLR would be 14.50 per...

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RBI caps bank investments in MFs

Mumbai: To stop the circular movement of funds between banks and debt-oriented mutual funds (DoMF), the Reserve Bank today limited bank investment in liquid schemes of such funds at 10 per cent of their net worth. "The investment in liquid schemes of DoMFs by banks will be subject to a prudential cap of 10 per cent of their net worth as on March 31 of the previous year," the Reserve Bank said in its 'Monetary Policy Statement for 2011-12'. The RBI said that same money was circularly moving between the banks and the DoMFs, which could potentially...

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