Allahabad bank to expand branches

COIMBATORE: Public Sector Allahabad Bank has set a target of adding 155 branches and 500 ATMs across the country this fiscal, besides a branch in Bangladesh, a top bank official said today. Of this, three branches would be opened at Namakakal, Tirunelveli and Thanjavur in Tamil Nadu, which has 51 branches at present, Bank's Executive Director,M R Nayak told reporters after opening its 2,459th branch at Kalapatti in the city. Having a branch in Hongkong and a representative office in China, the Bank is awaiting clearance for starting a branch in...

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Kotak Bank to fund Ace traders

Ace Derivatives and Commodity Exchange today launched a facility, ComFin, to enable seamless financing of commodity deliveries in collaboration with Kotak Mahindra Bank. “We are delighted to provide this facility to our members and clients. ComFin will address the latent need of funding requirement and will help market participants transact and take or deliver commodities on the exchange efficiently and seamlessly,” Ace Derivatives and Commodity Exchange Chief Executive Mr Dilip Bhatia told reporters here. The Kotak Group is the majority stake...

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SBT, KVB hike NRE term deposit rates

State Bank of Travancore (SBT) has announced a steep hike in interest rates on NRI term deposits. The new rates are effective from Saturday (December 24) for fresh deposits as well as those being renewed on maturity, a spokesman said here. As per the revision, interest rate for deposits for a period of one year to less than two years will be 8 per cent (existing rate 3.82 per cent), the highest in recent years. The interest rate for deposits of a period of two years to less than three years will be 7.50 per cent (3.51 per cent) and for three years...

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Make moolah from Muthoot Finance NCD

As the interest rates are close to peak, many fixed-income investors are trying to lock-into instruments which offer high rates of interest. To attract such investors, after a pause of four months, Muthoot Finance has come up with its second public issue of non-convertible debentures (NCD). Muthoot Finance, the largest gold loan company in India, is offering 13-13.25 per cent interest rates on 2, 3 and 5 year tenors. It also has a product which doubles your money in 66 months offering a pre-tax yield of 13.46 per cent. Investors can consider subscribing...

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With cost control, ‘we are confident of making profits in 2011'

HDFC Life Insurance, the industry's third largest private player, expects to report profits this year. It will do this by controlling costs, said Executive Director and Chief Operating Officer, Mr Paresh Parasnis, in an interview with Business Line. A fellow of the Institute of Chartered Accountants of India, Mr Parasnis' responsibilities include driving and spearheading several key initiatives of HDFC Life, such as setting up branches, driving sales and servicing strategy, leading recruitment, contributing to product launches and performance management...

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SBI to launch mediclaim facility soon

India’s largest lender State Bank of India (SBI) will soon launch mediclaim and accidental insurance facility for its savings bank account holders over nominal charges. The scheme is likely to be launched in January or February 2012, SBI chairman Pratip Chaudhary said here on Tuesday. “We are holding a meeting of SBI general managers in Lucknow, wherein the contours of the insurance scheme would be given a final shape before it is launched in New Year,” he told to reporters here this evening. He, however, said the scheme would be almost 50 per...

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Bank not at fault if ATM card misused

New Delhi: A person cannot claim damages from bank if he fails to immediately block his lost ATM card and money is unauthorisedly withdrawn by using the card, a district consumer forum has said. It said the bank would have been liable if the transaction of withdrawal of money took place after blockage of the card. A bench of Central Delhi District Consumer forum passed the order while dismissing a complaint filed by a Faridabad resident Deepa Singh alleging that bank is liable for the compensation as it allowed illegal withdrawal of money from...

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RBI slaps Rs 5-lakh fine on Gondal Nagrik Sahakari Bank

The Reserve Bank of India has imposed a penalty of Rs 5 lakh on cooperative sector lender Gondal Nagrik Sahakari Bank for its failure to adhere to the guidelines on disclosure of loans to directors. “The RBI has imposed a monetary penalty of Rs 5 lakh on Gondal Nagrik Sahakari Bank Ltd... for granting loans to directors, not correctly reporting loans to directors to RBI in the statutory returns on advances to directors...,” the apex bank said in a statement. Gondal Nagrik Sahakari Bank was also found guilty of not submitting cash transaction reports...

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SBBJ's ‘Ready Money' deposit scheme

The State Bank of Bikaner and Jaipur on Friday launched a new-term deposit, Ready Money, which carries 8.50 per cent interest for any period between seven and 180 days. The new deposit scheme is meant to attract high-value liquid funds from various segments including individuals and companies, Mr Shiva Kumar, Managing Director, State Bank of Bikaner and Jaipur, said in a release. “Apart from providing high return for short period, it also gives high liquidity, since the penalty for prepayment has been waived for this product,” Mr Shiva Kumar said. Minimum...

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IRDA dismantles motor third party pool

The Insurance Regulatory and Development Authority has created a Motor Third Party Declined Risk Insurance Pool. It provides mandatory third party cover for commercial vehicles. The existing motor third party pool will be dismantled with effect from March 31, 2012. The motor third-party pool was created in 2007. In an order issued on Friday, IRDA said the existing motor third party pool is eroding interest of the policyholders besides causing financial stress to the general insurance companies. The newly-created declined pool would be applicable...

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NHAI to launch tax-free bonds

New Delhi: Unfazed by uncertainty in the capital markets, the National Highways Authority of India (NHAI) will launch its first ever tax-free bonds issue of Rs 10,000 crore on December 28. The issue will close on December 30, a senior Road Transport Ministry official said. The official further said the interest (coupon) rate of the bonds issue will be between 8 to 8.5 per cent, while refusing to disclose the exact number. "A formal announcement will be made tomorrow by Road Transport Minister C P Joshi and you should wait for that," the official...

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RBI relaxes cap on transactions via mobiles

Mumbai: With a view to allowing customers to transfer bigger amounts and in line with growing popularity of the system, the RBI removed the Rs 50,000 transaction limit through mobile phones. "On a review it has been decided to remove this cap (of Rs 50,000 per customer per day)," the Reserve Bank said in a notification. The central bank, however, added that lenders may place per transaction limits based on their own risk perception with the approval of their boards. It said banks are increasingly extending mobile banking facilities to their customers. "Interbank...

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RBI raises alarm over corporate loans

Mumbai: The Reserve Bank of India (RBI) today said Indian companies may find it difficult to repay loans as rising input cost is putting pressure on their profit margins. "The outlook of the firms shows signs of weakness which can be attributed to rise in input prices, interest rates, slackening demand and some infrastructural constraints. Servicing of loans by them, therefore, may come under stress," said the RBI's Financial Stability Report (FSR). It said the profit margin of the corporate sector has dipped, which indicates its reduced pricing...

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With restrictive regulations, banks do not have great ability to attract household savings: Vijaya Bank chief

From a bank's perspective, savings bank is an operative account, and banks need paraphernalia to manage the portfolio. If the savings bank portfolio is higher, the impact of the deregulated savings rate regime would be high, Mr H.S. Upendra Kamath, Chairman and Managing Director, Vijaya Bank, told Business Line. Excerpts from the interview: How is Vijaya Bank gearing up for the deregulated savings rate regime? We are waiting and watching. From the point of view of depositors, we are happy that today they are in a position to get improved returns...

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Government may borrow $9.5 billion by pledging property & shares of ITC, L&T and Axis Bank

MUMBAI: Government plans to borrow up to Rs 50,000 crore ($9.5 billion) by pledging property and shares to bridge the budget deficit, Reuters quoted Bloomberg news agency on Thursday, citing unnamed government officials. Shares in companies such as cigarette-to-hotels group ITC, engineering conglomerate Larsen & Toubro and Axis Bank held by a state-controlled fund could be offered as collateral to raise the cash, Bloomberg said. The cash will be used by a newly-created fund manager to buy stock in state-run companies and help the government's...

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EPFO may lower interest rate to 8.25%

New Delhi: The advisory panel of retirement fund body EPFO has recommended a lower rate of interest of 8.25 per cent for the current fiscal compared to 9.5 per cent last year, a move that will affect over 4.7 crore subscribers. The unions' representative on EPFO's advisory body, Finance and Investment Committee (FIC), has demanded maintaining the rate of interest at 9.5 per cent for 2011-12. "FIC opined that payment of 8.25 per cent rate of return to its 4.7 crore subscribers during this fiscal is feasible," a source privy to the development said...

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YES Bank hikes savings bank rate by 100 bps

YES Bank has hiked interest rate by 100 basis points to 7 per cent on savings bank deposits with balances of over Rs 1 lakh. The bank offers 6 per cent interest on savings bank deposits for balances below Rs 1 lakh. This is the second time that YES Bank is hiking interest rate on savings bank deposits after the RBI deregulation. For the non-resident savings accounts (NRE and NRO), the bank has raised the interest rates by 200 bps to 6 per cent for balance of up to Rs 1 lakh and by 300 bps to 7 per cent for over Rs 1 lakh balance, said a press release...

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Karnataka Bank raises NRE deposit rates

Karnataka Bank Ltd has increased interest rates on NRE deposits with effect from December 19. A bank release said here that the bank has increased the interest rates on NRE deposits from 3.82 per cent to 9.75 per cent for one year to less than two years; from 3.51 per cent to 9.50 per cent for two years to less than three years; and from 3.64 per cent to 9.50 per cent for three years to five years. The above rates are applicable to all fresh NRE term deposits and renewals of maturing deposits from December 19. The bank hopes to accelerate the flow...

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Lok Sabha approves Bill to raise capital of Exim Bank

The Lok Sabha has given its nod for a Bill to enhance the authorised capital of Exim Bank of India from the existing Rs 2,000 crore to Rs 10,000 crore. This Bill — Export Import Bank of India (Amendment) Bill, 2011 — was passed after Mr Namo Narain Meena, Minister of State for Finance, assured the Lower House that supremacy of Parliament was not being diluted and that Members of Parliament would have a say in future capital enhancements of Exim Bank. “Capital infusion is made through Budget provision. It will have to come to you for approval,”...

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Three South-based banks hike NRE deposit rates

Karnataka Bank Ltd has increased interest rates on NRE deposits with effect from December 19. A bank release said here that the bank has increased the interest rates on NRE deposits from 3.82 per cent to 9.75 per cent for one year to less than two years; from 3.51 per cent to 9.50 per cent for two years to less than three years; and from 3.64 per cent to 9.50 per cent for three years to five years. The above rates are applicable to all fresh NRE term deposits and renewals of maturing deposits from December 19. The bank hopes to accelerate the flow...

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United Bank plans Rs 100-cr bond issue

United Bank of India plans to raise about Rs 100 crore through non-convertible bonds to augment its lower Tier-II capital, according to a company notification to the BSE. The bank proposes to issue unsecured, subordinated, redeemable, non-convertible bonds in the form of promissory notes of Rs 10 lakh each, for Rs 100 crore. The issue has been rated AA+ by Care and AA+/Stable by Crisil. The bond issue will have green-shoe options to raise additional Rs 100 crore on private placement basis. The bank will intimate the coupon rate and the date of...

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Credit growth likely to be 15-16% this fiscal, says DCB Bank CEO

DCB Bank is likely to end the current financial year with a 15-16 per cent growth in loans and over 20 per cent growth in deposits. The bank is looking to lend more to the micro, small and medium enterprises and retail segments, said Mr Murali Natarajan, Managing Director and CEO. SB rates The private sector bank is not looking to increase savings bank deposit rates and will wait for bigger banks to take the lead, he said on the sidelines of a press conference to announce its pre-paid card, jointly with ItzCash and Visa. The share of MSME and SME...

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Dewan Housing eyeing over 30% loan growth this fiscal

Banking on strong demand from semi-urban and rural areas, housing finance company, Dewan Housing Finance Ltd (DHFL), is targeting disbursements aggregating Rs 8,800 crore by March 2012, an increase of around 33 per cent over last year. In July-September 2011, the disbursements had increased by 28 per cent to Rs 2,139 crore. Total disbursement in 2010-11 was Rs 6,505 crore. The company is seeing between 35 per cent to 50 per cent growth in Punjab, parts of Tamil Nadu, Kerala and Gujarat. This trend is likely to continue, said Mr Anil Sachidanand,...

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SBI's teaser home loans set to pinch borrowers more

Bank will charge floating rates of interest from January. Home buyers who had taken loans from State Bank of India (SBI) under the so-called ‘teaser rate’ housing loan schemes three years ago, will now have to pay more. The bank will start charging interest on these loans on a floating rate basis from January 2012. The housing loan schemes — SBI Easy Home Loan and SBI Advantage Home Loan — were launched by the bank’s previous chairman, O P Bhatt, in January 2009, with a fixed rate of interest for the initial three years. The bank, which first modified...

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SKS Microfinance to raise FII investment limit to 74%

SKS Microfinance, India's only listed microlender fighting a cash crunch, said on Wednesday its shareholders approved raising the investment limit of foreign institutional investors in the company to 74 percent from 24 percent. Battered down shares in SKS rose 5 percent to 98.40 rupees following the news. Earlier this month, SKS said it plans to raise a maximum of 5 billion rupees ($97.25 million) through a share sale to institutional investors by March 2012. Source: EconomicTi...

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