LIC loan scam: Fresh CBI probe into DB Realty

Mumbai: Nearly a year after it busted an alleged bribes-for-loans scandal involving LIC Housing Finance, some public sector banks and a host of private companies, the CBI has quantified the loans disbursed in the case at Rs 12,000 crore. The agency has also registered a fresh Preliminary Enquiry (PE) against DB Realty, as it allegedly availed of a loan of Rs 300 crore even though it failed the eligibility norms for corporate loans. The CBI had last November claimed that it had smashed a massive loan racket and alleged that a Mumbai-based financial...

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IDBI Bank to open about 250 branches across the country

NEW DELHI: State-owned IDBI Bank on Saturday said it plans to open about 250 branches across the country and a branch in Singapore over the next year. "We will be opening 200-250 branches across various states in next 12 months," IDBI Bank Chairman and Managing Director R M Malla told PTI. Besides, the bank is also looking at ramping up its international presence, he said. The bank submitted applications to the Monetary Authority of Singapore for setting up an Offshore Banking Unit there and to the China Banking Regulatory Commission for setting...

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Irda wants annuity a must with all pension plans

The Insurance Regulatory and Development Authority (Irda) wants all pension products to do exactly what they are expected to do — provide pension to policyholders. Speaking to Business Standard, Irda chairman J Hari Narayan explained, “There are many traditional pension plans where annuity may or may not be available. This defeats the entire purpose of a pension plan. We want to make annuity compulsory for all traditional pension products because it is the basic premise of the product.” If the annuity is not mandated, the policyholder is given...

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Worried SEBI wants Finance Ministry to plug holes in Global Depository Receipts guidelines

KOLKATA: The Securities & Exchange Board of India (Sebi) is in talks with the finance ministry to tighten rules relating to issuance of Global Depository Receipts as the regulator has found that several local companies are skirting guidelines to raise funds overseas. According to Sebi Chairman UK Sinha, some firms are misusing the facility to raise funds through issuance of equity overseas in the form of Global Depository Receipts (GDRs) which have underlying shares of Indian companies. Over the past six months, a surveillance system put in...

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RBI hikes Paypal payments ceiling to $3,000 per transaction

New Delhi: Users of online payments gateway PayPal in the country can now receive up to USD 3,000 per export-related transaction in their accounts, with the RBI raising this limit from USD 500 per transaction earlier. The increase in the limit is with immediate effect, but merchants using Paypal accounts to receive funds would need to add their PAN (Permanent Account Number) and bank account details to comply with the RBI guidelines, PayPal said today. The step will help the Indian SMEs and consumers who use Paypal to receive their payments. In...

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India Post's ATM plans hit RBI hurdle

India Post's plan to set up automated teller machines (ATMs) in its post offices may fail to impress the banking regulator. India Post is in talks with the Reserve Bank of India (RBI) to set up ATMs. However, since according to norms, only banks are allowed to set up ATMs, the central bank is not in favour of allowing India Post to set up ATMs. According to sources in the banking industry, if India Post set up ATMs, they should fall under the RBI's purview for regulation purposes. India Post has proposed to set up a subsidiary, Post Bank of India,...

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IMF backs RBI's monetary tightening policy ahead of policy review

NEW DELHI: The International Monetary Fund has endorsed the current monetary tightening in India ahead of the policy review by the Reserve Bank of India on October 25, providing a counter to the rising chorus of demand for a pause in interest rate hikes. In countries such as China, India and Korea where inflation remains above target, and inflation expectations have continued to rise, the current pace of monetary tightening remains appropriate, the IMF said in its Regional Economic Outlook for Asia Pacific released on Thursday. The RBI has raised...

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Government mulls one common holding company for all PSU banks

NEW DELHI: The government is planning to change the way it controls state-run banks, so they can raise lots of additional capital without the government losing control over them. The finance ministry believes one common holding company to unite 21 state-run banks could eliminate ad hoc, last-minute infusion of resources that has been the practice so far. A holding company structure allows for innovation in capital infusion, the reason why nearly 85% of US banks have such a structure. A holding company structure will allow the parent firm to raise...

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Sebi slaps Rs 5L penalty on Pantaloon

Mumbai: Market regulator Sebi has imposed a penalty of Rs 5 lakh on retail major Pantaloon for failing to address investor grievances within the stipulated timeframe. "After considering all the facts and circumstances of the case ... find that the noticee (Pantaloon Retail India Ltd) failed/delayed in redressing the complaints ... within the time stipulated by Sebi," the market regulator said in an order while imposing the Rs 5 lakh penalty. The Securities and Exchange Board of India (Sebi) had earlier identified the Kishore Biyani-promoted firm...

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RBI opposes $20 bn wealth fund from forex reserves

The Reserve Bank of India (RBI) has opposed the creation of a $20 billion sovereign wealth fund, for acquisition of energy assets overseas, out of foreign exchange reserves and wants the government to create the corpus for it from the Budget. A Group of Ministers headed by Finance Minister Pranab Mukherjee today deliberated on the possible ways of creating a fund on the lines of ones that exit in countries like China. "Various things were discussed but no view has emerged," Oil Minister S Jaipal Reddy said after the 75 minute meeting. Sources privy...

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EXCLUSIVE: Former StanChart I-banking MD to join MAPE Advisory

Sunil Mehra, the renowned investment banker, is set to start his new stint at MAPE Advisory Group as Managing Director-I Banking. Before joining MAPE, Mehra was with Standard Chartered as a Managing Director in the Corporate Finance group. Mehra, who enjoys an experience of almost 20 years in investment banking sector, has been involved with key transactions include Tata Chemicals’ acquisition of General Chemicals, Cimpor’s acquisition of Digvijay Cement, Mylan Labs’ acquisition of Matrix Labs, ADR issuance by Dr Reddy’s Labs and convertible bond...

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HDFC Bank to offer Diners Club credit cards in India

MUMBAI: The country's second largest private lender HDFC Bank on Thursday entered into a strategic alliance with Diners Club International to offer the latter's premium credit cards in the country. The alliance will help HDFC Bank, which is already the country's largest credit card issuer, to further extend its foray into the super premium segment to address the uber rich clientele," the bank said in a statement. The bank has around five million existing credit card customers in the country and it adds 18-20,000 new customers a month. HDFC Bank...

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Dhanlaxmi Bank to raise fresh capital by December

MUMBAI: Thrissur-based, private sector bank Dhanlaxmi Bank, which is battling charges of alleged irregularities in its accounts raised by an industry union, plans to raise fresh capital by December. The bank's managing director and chief executive officer Amitabh Chaturvedi said that the lender would need fresh capital to support the bank's growth in the next three months. However, he declined to comment on the size of capital-raising and the route through which funds will be raised as the bank is in its silent period prior to announcing its second...

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SBI may delay overseas fund-raising plans

State Bank of India is likely to defer its overseas fund-raising plans on account of unattractive yields and moderation in growth. The country’s largest lender had planned to raise $1-billion funds through medium-term notes in November, but is now waiting for economic stability. Pratip Chaudhuri“Right now the US treasury yield have fallen sharply, but investors want the same yield of 4.5 per cent as before. They do not want to understand the direction in which the treasury yields are moving,” SBI Chairman Pratip Chaudhuri told Business Standard....

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Hudco to relaunch tax-free bond with higher coupon rates

A tax-free bond Housing and Urban Development Corporation (Hudco) issued a fortnight ago has elicited poor response, prompting the government-owned entity to think of relaunching it with higher coupon rates. According to market players, the collections — after the issue opened on September 29 — were just around Rs 10-20 crore in the first round that closed on Wednesday. The urban infrastructure company had, after getting the approval from Central Board of Direct Taxes, offered tax-free bonds at coupon rates of 7.51 per cent for 10 years and 7.75...

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RBI's automated data reporting norms to create Rs 500-cr mkt for IT firms

The Reserve Bank of India’s decision to automate the process of filing regulatory reports appears to have opened a door of opportunities for technology firms. Industry players expect banks to invest over Rs 500 crore over the next one year to migrate to the new system of automated data flow. Mid-sized software companies are also sensing an opportunity to cross-sell their other banking software products along with the automated data flow solution. For instance, iCreate Software, a Bangalore-based information technology firm, has already secured...

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Dhanlaxmi shares tank on window-dressing charges

Kerala-based Dhanlaxmi Bank’s stocks tanked on Tuesday on allegations that the bank had resorted to window dressing and that its profitability was under pressure. The allegations were made by an employees association. The Thrissur-headquartered bank’s management, however, refuted all charges. The All-India Bank Officers Confederation (AIBOC) has written to the Reserve Bank of India (RBI), expressing concerns over the financial health of the bank. The employees association also opposed the extension granted to chief executive Amitabh Chaturvedi...

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High rates reduce demand for loans; new loans by banks fall to four-year low in September

MUMBAI: New loans by banks as a proportion of fresh deposits have fallen to a four-year low this September, indicating investors are flocking to the safety of banks when equity markets are wobbly, and that demand for loans are slowing due to high rates. Although the so-called credit-deposit ratio has halved to less than 50% from as high as 100% at the beginning of the year, banks do not see any immediate fall in interest rates as they need to attract deposits ahead of huge government borrowing. "Deposits are growing since the equities market is...

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RBI unveils cheaper credit for exporters

New Delhi/Mumbai: The Reserve Bank today announced 2 per cent interest subsidy on Rupee export credit to the labour-oriented and small scale sectors to cushion them from slowdown in the major markets like the US and Europe. Exporters of handicrafts, handlooms and carpets will be eligible for the interest subvention to be available upto March 31, 2012, the RBI said. The exporters in the small and medium enterprises across all the sectors would also be entitled for cheaper bank credit, subject to a minimum interest rate of 7 per cent. In a direction...

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RBI's PNB auditor action illegal: HC

New Delhi: The Delhi High Court has held as illegal the decision of RBI to discontinue the services of a Statutory Central Auditor (SCA) of Punjab National Bank (PNB) without fair and proper enquiry into the allegations against the firm. "The Court holds that the impugned decision of the RBI, as communicated in its letter on June 24, 2009 to the PNB, to discontinue the Petitioner as an SCA, even for the limited extended period ending 30th June 2009, was violative of the principles of natural justice and was, therefore, illegal," Justice S Muralidhar...

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Another RBI interest rate hike will hurt demand and pull down growth: Corporate India

MUMBAI: Members of Corporate India have told the Reserve Bank of India (RBI) that another increase in interest rate would hurt demand and pull down growth. They also urged the monetary authority to intervene in the currency market as a depreciating rupee could stoke inflation. The views were spelt to RBI deputy governors and other senior central bank officials by a team comprising Godrej group chairman Adi Godrej, Hiranandani group managing director Niranjan Hiranandani, L&T chief financial officer R Shankar Raman, Crisil MD Roopa Kudva, senior...

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J-K Bank biz rises by 25 pc in H1 FY'12

Srinagar: The business of Jammu and Kashmir Bank has increased by 25 per cent during the first two quarters of the current fiscal compared to corresponding period last year. "As against last half year's business of Rs 60,000 crore, the Bank has achieved over Rs 75,000 crore during the corresponding period this year, registering an overall growth of about 25 percent," Jammu and Kashmir Bank Chairman Mushtaq Ahmad said at a meeting chaired by Chief Minister Omar Abdullah. The Bank chairman presented two dividend cheques worth Rs 67 crore to Omar...

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