SBI asks Kingfisher Airlines to reverse about Rs 100 crore paid to Vijay Mallya and UB Holdings

Kingfisher Airlines, the carrier waiting to be bailed out by banks, has been directed by the State Bank of India to reverse nearly Rs 100-crore guarantee commission it paid to promoter Vijay Mallya and UB Holdings as it is a regulatory violation, said three people familiar with the direction. Lenders are seeking the reversal of transactions by the ailing airline as a pre-condition to consider the second round of bailout in as many years after it posted yet another quarter of losses. "Mallya has agreed that they would not exercise the option," said...

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SBI not to extend fresh loans and investments in Maldives due to political turmoil

The State Bank of India has decided not to extend any fresh loans or make new investments in the Maldives until the political situation improves there. SBI's three branches enjoy a dominant position in the island nation, holding a quarter of its deposits and 42% loans. "We will not take any fresh exposure till June this year," said a bank official. Maldives plunged into a political turmoil last month after protesters, backed by police, toppled Mohamed Nasheed, Maldives' first democratically elected leader. An e-mail sent to the bank's international...

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Vijaya Bank expects NIM at 3% in current fiscal

Vijaya Bank is likely to close the current fiscal with a net interest margin of 2.85-3 percent despite the prevailing difficult economic environment, a top bank official said. “We hope to post a net interest margin (NIM) of 2.85-3 percent in the current financial year,” said Ms Subhalakshmi Panse, Executive Director, Vijaya Bank. She said the bank is relying on garnering Casa deposits and to shedding bulk deposits to increase NIM in the current quarter. Referring to growth in bad assets in the third quarter, Ms Panse said those NPAs were on account...

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Indian Overseas Bank opens 11 new branches

Indian Overseas Bank has opened 11 new branches in Madurai region. According to Mr K.M. Thirunavukkarasu, Chief Regional Manager, as part of celebration of Platinum Jubilee of the bank, seven new branches have been opened at Ellis Nagar in the city, Paravai in the outskirts of the city, Peraiyur, Silaiman, Perungudi, Usilampatti and Solavandan; four new branches opened in VIrudhunagar district at Narayanapuram, Malli, Sevalpatti and Mamsapuram. An ATM has also been opened at Karumattur, beyond M.K. University, he added. He further said that Platinum...

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Canara Bank opens its first ultra-small branch in TN

Canara Bank opened its first ultra-small branch in the State and second in the country, at Oorseri Panchayat near Alanganallur, near here, recently. Linked with Core Banking Solution through a virtual private network, the branch, staffed by a Business Correspondent, would be open on all seven days in the week. All account holders are to be issued with smart cards and deposits and disbursals with an upper limit of Rs 2,000 would be facilitated, besides linkage of loan applications to the parent branch. The first branch has been opened at Aralumallige...

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CMD-designate for Oriental Bank

Oriental Bank of Commerce today said that Mr S.L.Bansal has joined the bank as Chairman and Managing Director designate. He will take full charge of his new role with effect from March 1. Mr Bansal will come in the place of Mr Nagesh Pydah, who will retire on February 29....

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Bank of Maharashtra cuts base rate

In a bid to push credit in the run-up to the close of the financial year, Bank of Maharashtra has decided to pare its base rate by 10 basis points to 10.60 per cent with effect from February 21. The public sector bank has also said it will offer housing loans up to Rs 30 lakh at the Base Rate for a repayment period of five years under the floating rate option. Home loans above Rs 30 lakh and less than Rs 75 lakh, and Rs 75 lakh and above will be charged 11.10 per cent (Base Rate + 0.50 per cent) and 11.35 per cent (Base Rate + 0.75 per cent) interest...

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Indian banks eye assets of European counterparts

As European lenders seek to deleverage their books to meet new capital adequacy norms amid the euro zone sovereign debt crisis, Indian banks are eyeing a business opportunity — acquiring quality assets at attractive prices. Chanda Kochhar, managing director and chief executive officer, ICICI Bank, said, “For the Indian banking sector, it is a business opportunity. Some European banks are actually shedding great quality Indian assets at very attractive prices. We will see many Indian banks coming forward to pick up these loans.” She was speaking...

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IndusInd Bank to pick up 3-5% stake in Aviva Life

Private sector lender IndusInd Bank is set to pick up three-five per cent stake in private sector life insurer Aviva Life Insurance. According to sources privy to the development, as part of the deal, apart from offering shares, Aviva Life would also pay an advance commission, taking the total valuation of the deal to around Rs 1,000 crore. “The final modalities are being worked out. IndusInd Bank would have a board meeting later this week, after which the deal would be announced,” a source said. The private sector lender is already a corporate...

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YES Bank plans to expand branches in south to 150

YES Bank, which claims to be the country's fourth largest in the private sector, plans to grow its branch network to between 120 and 150 in the South by year 2015. This is a sub-target set by the Version 2.0 growth mode that the bank has embarked on since year 2010, says Mr R. Ravichander, bank's Group President and Head Business Development - South. VERTICAL CLIMB The bank has been pushing retail business this year as part of Version 2.0. Rather than seek to negotiate a ‘gradient' in terms of achieving incremental targets, it has been bracing...

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Reliance Life launches Classic Plan II

Reliance Life Insurance Company (RLIC), part of ADAG’s Reliance Capital Ltd, on Thursday launched a new unit-linked plan, called Classic Plan II, that offers customers dual benefits of insurance protection and market-linked return. Announcing the launch here, Mr Malay Ghosh, President and Executive Director, Reliance Life, told reporters that this was the first time that the company is introducing a new life cover option in its unit-linked investment plan portfolio that offers the customer life cover benefit equal to the sum assured or the fund...

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White label ATMs may not hit banks' rollout plans too much

Banks do not plan to ease up on their ATM expansion drive despite the Reserve Bank of India's plans to allow non-banks to set up white label ATMs (WLAs), say bankers. ATMs are an important part of banks' alternative channel strategy to reach customers, to showcase their products and services, and create brand awareness. This is reflected in the increase in the number of ATMs in the April 2011-January 2012 period, during which banks added 14,477 ATMs. At end January 2012, the country had 89,655 ATMs, according to the National Payments Corporation...

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LIC may take up to 5% stake in Punjab & Sind Bank

The Government-owned Punjab and Sind Bank has decided to go for a preferential issue of shares to another state-run firm, Life Insurance Corporation of India (LIC). Money realised through this issue will help the bank to strengthen Capital to Risk-weighted Assets Ratio (CRAR). With the government being in a tight spot on the fiscal front, India's largest life insurance company is coming to the rescue of public sector banks to pump in funds to boost their Tier-I (core) capital. After the government, LIC is the single biggest shareholder in majority...

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Bank of Baroda to hire 600 probationary officers

Bank of Baroda is recruiting probationary officers (in the junior management grade/Scale I) to fill up about 600 vacancies across the country. The bank has specified that candidates with a total weighted standard score of 125 in the common written examination conducted by Institute of Banking Personnel Selection (IBPS) and fulfill other criteria will be eligible to apply. The bank will specify these criteria and other details on its Web site after February 21....

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SBI sets sights on absorbing State Bank of Mysore

After taking over two associate banks — State Bank of Saurashtra in 2008 and State Bank of Indore in 2010 — State Bank of India has set its sights on assimilating the nearly century old State Bank of Mysore (SBM) this year. As part of its consolidation strategy, India's largest bank wants to first merge the smaller associate banks before attempting to take over relatively bigger associates such as State Bank of Hyderabad (SBH) and State Bank of Travancore (SBT). Branch network “We will take over smaller associate banks first as it is easier to...

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Standard Chartered Bank to pay Rs 55K to customer as damages

Standard Chartered Bank has been ordered by a consumer forum to pay Rs 55,000 as damages to a customer for harassing him by raising a demand of over Rs 90,000 for payment against credit card dues and putting his name on the defaulters' list even though he had returned the card. The District Consumer Forum (Central) gave the order on a complaint of North West Delhi resident Ajit Kumar that the bank had sent a bill demanding over Rs 90,000 and put his name in the defaulters' list in 2008 even though he had returned the credit card, unused, in 1999. The...

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United India Insurance Q3 profit up 24%

United India Insurance Company has reduced the claims ratio to 81.45 per cent for the nine-month period ended December 31, 2011, which resulted in the combined ratio (a measure of the profitability of insurance operations), dropping to 114.69 per cent from 127.64 per cent during the corresponding period of the previous year. The investment income of the company for the period stands at over Rs 1,106 crore. The market value of the company's total investment portfolio at the end of the third quarter was at Rs 15,603 crore. Business growth The net...

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RBI hikes bank rate to 9.5%

After a gap of nearly nine years, the Reserve Bank of India has increased the bank rate by 3.5 percentage points to 9.5 per cent with immediate effect. “This (the increase) should be viewed and understood as one-time technical adjustment to align the bank rate with the marginal standing facility (MSF) rate rather than a change in the monetary policy stance,” RBI said in a notification, adding the new rate will be with effect from February 13. The bank rate has lost its significance as a monetary policy tool as the central bank signals stance through...

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Axis Bank reappoints Shikha Sharma as Managing Director

Axis Bank has reappointed Shikha Sharma as Managing Director for a further period of 3 years. The board has approved the reappointment of Shikha Sharma as Managing Director and Chief Executive Officer of the bank for a further period of three years with effect from June 01, 2012 to May 31, 2015, Axis Bank said in a filing on the Bombay Stock Exchange (BSE). The reappointment will be subject to approval of the Reserve Bank of India and subject to confirmation by the shareholders of the bank at the next general meeting, it said. The bank had appointed...

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SBI launches special package for railway employees

State Bank of India has launched a special salary package for the Railway employees. According to Mr B. Venugopal Reddy, Deputy General Manager, Administrative Unit, SBI, Hubli, the package consists of special privileges to employees of railways drawing their salary from State Bank of India. Special previleges The privileges include reduced interest rates on home loans, car loans and personal loans. The concessions are available in the locker rentals. He further stated that zero balance saving bank accounts are opened for all the persons. Free...

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SBI’s asset quality worrying as bad loans double in Q3

State Bank of India reported a net profit of Rs 3,263 crore for the quarter ended December 2011, up 15 per cent from Rs 2,828 crore in the corresponding year-ago quarter. The increase in profit was on account of a robust rise in net interest income, which touched an all-time high and improvement in net interest margins. Profits grew despite an increase of over Rs 1,300 crore in loan loss provision and an over Rs 800-crore depreciation in investment on account of losses in the equity portfolio, said Mr Pratip Chaudhuri, Chairman, SBI. “The bank...

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Manappuram Fin ‘will ensure' compliance with RBI norms

Manappuram Finance will take immediate steps to completely ring-fence its operations and ensure there is no overlapping of business, assets, branches or personnel with other entities owned by the promoters or their family members. The Board of Directors of the company met at Thrissur to review the operations and performance in the context of the recent communication received from the RBI. The Board also directed the company to take all measures to fully address the concerns raised by the central bank. To enhance governance and better manage growth...

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Strong case for higher govt stake: SBI Chairman

The State Bank of India Chairman, Mr Pratip Chaudhuri, on Monday said there is a strong case for the government to infuse capital in his bank. The reason: the 18.12 per cent post-tax return that the capital investment will fetch will be far in excess of the cost of the government's borrowing. “The cost of government borrowing is in the 8-9.5 per cent range. But infusing capital in SBI will give the government a post-tax return of 18.12 per cent,” explained the SBI chief, at a press meet. The expected capital infusion of Rs 7,900 crore, coupled...

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