State Bank of India to cut size of rights issue, new proposal expected soon

NEW DELHI: The country's largest bank, State Bank of India , will move a fresh proposal for its rights issue but of a smaller amount than Rs 20,000 crore proposed earlier, because of the government's fiscal constraints. The government holds 59% stake in the bank and will have to pick up corresponding amount in the offer if it does not want its stake to fall. A financial ministry official said the government was ready to consider a smaller offer. SBI Chairman Pratip Chaudhuri on Friday said the bank has prepared a draft proposal on the rights issue...

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Andhra Bank to raise BPLR to 14.75% from July 11

MUMBAI: State-run Andhra Bank said on Saturday it will raise the benchmark prime lending rate to 14.50 percent per year from 14.25 percent effective July 11. Source: EconomicTi...

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IRDA imposes fine of Rs 70 lakh on SBI Life Insurance

CHENNAI: The Insurance Regulatory and Development Authority (IRDA) has imposed a fine of Rs 70,00,000 on SBI Life Insurance company for paying around Rs.204 crore to eight of its corporate agents and six master policyholders, far in excess of the stipulated levels. In an order Friday, IRDA asked SBI Life Insurance to pay the penalty within 15 days. SBI Life Insurance is a 74:26 joint venture between State Bank of India (SBI) and BNP Paribas Cardif . According to IRDA, payments were made by SBI Life in violation of laid down guidelines. The...

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Coming soon: Coins with new rupee symbol

The government today released new series coins of Rs 1, 2, 5 and 10, bearing the rupee symbol, which will be in circulation soon. A new series coin of 50 paise was also released. "New coins will not only reduce the cost of moving materials but also are of user friendly size and weight," Finance Minister Pranab Mukherjee said after releasing the new series. In a statement, the Finance Ministry said the security edging of new series of coins would be good for better recognition by visually challenged persons and will have improved counterfeit resistance. The...

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RBI slaps fine on Kolhapur bank for violating KYC norms

The Reserve Bank today imposed a penalty Rs 5 lakh on Kolhapur District Central Co-operative Bank for violation of guidelines related to Know Your Customers (KYC) norms and Anti Money Laundering standards. "The RBI has imposed a monetary penalty of Rs 5 lakh on Kolhapur District Central Co-operative Bank ...For violating guidelines issued by the Reserve Bank on Know Your Customers (KYC) norms/Anti Money Laundering (AML) standards", RBI said in a statement. The apex bank said it had issued a show cause notice to the bank, and "came to the conclusion...

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SBI denies funding to realty projects in disputed areas

Adopting a cautious approach in the wake of Supreme Court asking the U P government to return land to original owners, country's largest lender SBI today said it will not finance real estate projects which are mired in disputes over acquisition of land. "...If in a particular area where there has been a difficulty, those will not be financed," State Bank of India (SBI) Chairman Pratip Chaudhuri told reporters on the sidelines of banking sector review conference presided over by Finance Minister Pranab Mukherjee. His remarks come two days after...

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Indusind Bank plans to raise 4-5 billion rupees via tier-2 capital

MUMBAI: Indusind Bank is looking to raise 4-5 billion rupees via tier-2 capital by end-September or beginning of October to meet its capital adequacy needs, Romesh Sobti, managing director and chief executive officer told reporters on Friday. The bank reported a net profit of 1.8 billion rupees for April-June earlier in the day. Source: EconomicTi...

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Punjab & Sind Bank raises lending rates by 25 bps

New Delhi: State-run lender Punjab & Sind Bank on Thursday hiked its minimum lending rate or base rate by 25 basis points to 10.25 per cent. The city-based bank has also hiked its benchmark prime lending rate (BPLR) to 14.75 per cent from 14.50 per cent with immediate effect, PSB said in a filing to the Bombay Stock Exchange (BSE). Further, the bank has also paid a dividend of Rs 36.61 crore to the government for the financial year 2010-11. Shares of PSB closed at Rs 100.80, down 0.35 per cent from previous close on the BSE. Source: Financial...

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IndusInd Bank net up 52% on surge in fee income

Mumbai: Private sector IndusInd Bank on Friday posted a 52 per cent jump in net profits for the quarter ended June 30 at Rs 180.18 crore, helped by a surge in fee income. The city-based lender's net profit for the April-June period last fiscal had stood at Rs 118.55 crore. “The core fee income grew 44 per cent to Rs 187.07 crore due to an increase in our third party products, trade and remittances, foreign exchange and investment banking income,” said IndusInd Bank Managing Director and Chief Executive Romesh Sobti. The net interest income (NIM)...

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SBI to raise $5 bn via offshore loans

New Delhi: The country's largest lender State Bank of India said on Friday that it plans to raise USD 5 billion through offshore loans by December.“We hope to raise USD 5 billion debt by December by means of foreign debt through medium-term notes (MTN),” said SBI Chairman Pratip Chaudhury. Speaking on the sidelines of a meeting between Finance Minister Pranab Mukherjee and chiefs of public sector banks, he said the debt would be raised during the second or the third quarter of this fiscal. “Right now, we have a total objective of USD 5 billion,...

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SBI to seek government's nod for rights issue this month

NEW DELHI: State Bank of India (SBI) will seek the government's nod to raise Rs 20,000 crore through the rights issue within this month, the bank's chairman Pratip Chaudhuri said on Thursday. "Draft proposal (for the rights issue) is with us. We are going to submit it this month to the ministry," the bank's Chairman Pratip Chaudhuri told reporters here. The government would continue to hold 59 percent stake in the bank after the rights issue, he said, adding "as of now there is one proposal which is on the table". SBI had earlier announced its...

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HDFC acquires 12% stake in MediAngels

Kolkata: HDFC Private Equity Fund has acquired 12 per cent stake in Angles Health, a global multi-speciality e-hospital service provider which manages mediangles.com."Deepak Parekh's HDFC private equity fund has picked up 12 per cent seed capital recently," co-promoter of Mediangles Arbinder Singal said. "We are looking for more funds to rollout more services on mobile, for video-conferencing and round the clock doctors' call-centre and other services," another co-promoter of e-hospital concept Debraj Shome said. After nearly two years of tests,...

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SBI ups lending rates 25 bps; deposits 1%

New Delhi: India's largest lender State Bank of India (SBI) today increased lending rates by 25 basis points and raised deposit rates by up to 100 basis points, a move that will make home, auto and other loans more expensive, but will provide better returns to savers. The bank has revised the base rate or the minimum lending rate upwards by 25 basis points (bps), or 0.25 per cent, to 9.50 per cent with effect from July 11, SBI said in a statement. The interest rates on fixed deposits with a maturity period of 1-10 years has been fixed at 9.25 per...

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Dhanlaxmi Bank hikes base rate by 25 bps

Mumbai: South-based Dhanlaxmi Bank today hiked its minimum rate of lending or the base rate by 25 basis points to 10.25 per cent, in line with peers in the lending industry. Loans under the older Benchmark Prime Lending Rate (BPLR) regime, which preceded the present base rate, also got dearer as the bank hiked the BPLR by 25 basis points to 19.25 per cent, it said in a release. "The hike in our base rate and BLPR reflects tight monetary conditions and is in line with market trends," the bank's Chief Financial Officer Bipin Kabra said. Other lenders...

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State Bank of India likely to raise lending rates shortly

NEW DELHI: Country's largest lender State Bank of India is likely to raise its minimum lending rate or base rate by 50-75 basis points later on Thursday, the bank's Chairman said. "There is a possibility of hiking base rate by 50-75 basis points by today evening," SBI Chairman Pratip Chaudhuri told reporters here. The bank's base rate currently stands at 9.25 per cent, which is probably the lowest in the industry. With the hike in the lending rates , home, auto and commercial loans will become expensive. As many as a dozen banks, including...

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SBI hopeful of rights issue this year

State Bank of India is hopeful the government would approve its proposed rights issue of equity shares, aimed to raise Rs 20,000 crore to support its growth plan. Speaking to Business Standard, managing director and chief executive officer Diwakar Gupta said, “Our capital adequacy ratio has fallen and we also need capital to support our growth plans. We are hopeful the rights issue will happen at the end of the third quarter or in the beginning of the fourth quarter of the financial year. The government has supported other public sector banks with...

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IDBI Bank buys 10% in UCX

IDBI Bank has bought 10% stake in Universal Commodity Exchange (UCX), which is yet to start operations, for Rs 10 crore, a newspaper reported. The commodity exchange is promoted by IT People, a company that provides software solutions to capital and commodity markets. "The idea behind acquiring equity is to push agricultural loan through this venture," said the bank's Chairman and Managing Director RM Malla, confirming the development to the newspaper.Moreover, IDBI will be the only bank among promoters and therefore all transactions of the exchange...

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DBS applies to open four more branches in India

SINGAPORE: Singapore's DBS Bank has applied to open four more branches in India as part of its ongoing expansion plans in the South Asian market. "We will set up the four branches as soon as we get approvals from the Reserve Bank of India ," Sanjiv Bhasin, the general manager & CEO for DBS Bank in India, said in Singapore today. DBS Bank has been rapidly growing in the Indian market, with 12 branches across 12 cities, the latest being in Cuddalore, which was opened in January this year. DBS operates 40 ATMs in 12 Indian cities as of June,...

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RBI limits banks' equity investments in companies & subsidiaries

MUMBAI: RBI on Wednesday set prudential limits for banks' equity investments in other companies and subsidiaries in order to prevent banks from having any significant influence over such entities even with limited investments. The Reserve Bank of India said banks can't invest more than 10 percent of their paid-up capital in a subsidiary or financial services company, while total investments made in all subsidiaries and non-subsidiary financial services companies shall not exceed 20 percent. For companies engaged in non-financial services activities,...

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Punjab National Bank set to foray into Canada

CHENNAI: Punjab National Bank (PNB), India's second largest public sector bank, is set to foray into the Canadian market by setting up a subsidiary with an estimated capital of Rs 100 crore, a top bank official said on Wednesday. The bank currently has operations in countries such as England, China and Dubai. Canada would be the latest foray of the bank in the overseas market. "We will be setting up our subsidiary there. It will initially serve the Indians living there. A capital of Rs 100 crore will be required," Punjab National Bank Chairman...

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SIDBI offers 9.84 per cent yield on 12-13-month fixed deposits

MUMBAI: The Small Industries Development Bank of India (SIDBI) on Wednesday said that it now offers general investors and bulk depositors an annualised yield of 9.84 per cent on its fixed deposit scheme with a duration of 12-13 months. SIDBI offers an interest rate of 9.50 per for fixed deposits of 12-13-months duration; 9.25 per cent for fixed deposits of 14-36-months' duration and 9 per cent for fixed deposits of 37-60-months duration. SIDBI also offers higher interest rates of 10.38 per cent to senior citizens for a 12-13-month period, 9.75...

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HDFC Bank sees RBI increasing key interest rates again

Mumbai: Leading private sector lender HDFC Bank today said it expects the Reserve Bank of India (RBI) to increase its key interest rates at least twice to contain the spiraling inflation. "What they (RBI) will do in this policy, I don't know, but one or two rate hikes are in the offing till inflation comes under control," HDFC Bank Managing Director Aditya Puri told reporters here on the sidelines of the bank's annual general meeting. The central bank has since March 2010 raised key interest rates ten times, with the latest on June 16 when it hiked...

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RBI: Data revisions crippling policymaking

Reserve Bank of India (RBI) Governor Duvvuri Subbarao on Tuesday said policymaking by the central bank had been hit by the frequent revisions in key data like that of the country’s growth, inflation and factory output. “RBI’s policy formulation is handicapped by frequent revisions to data. We make policies in real time, and if the provisional data these are based on are inaccurate, the resultant policies can turn out to be sub-optimal choices,” Subbarao said at the central bank’s Statistics Day conference. The governor cited the estimates of growth...

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