Centre to infuse Rs 1,248 cr in PNB

The Central Government has decided to infuse Rs 1,248 crore in Punjab National Bank (PNB) by way of preferential allotment of shares, the bank has said in a communication to the stock exchanges.

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IDBI Bank net inches up to Rs 416.76 cr in Q3

State-owned IDBI Bank today reported a marginal 1.7 per cent increase in net profit at Rs 416.76 crore for third quarter ended December 31, 2012.

The bank had posted a net profit of Rs 409.81 crore for the same quarter of last fiscal, IDBI Bank said in a filing to the BSE. 

Total income of the bank increased to Rs 7,070.19 crore during the October-December quarter, from Rs 6,281.83 crore in the year-ago period. 

For the first nine months of 2012-13, the bank has clocked 5.3 per cent rise in net profit, to Rs 1,327.64 crore, from Rs 1,260.83 crore in the same period of the previous fiscal. 

The bank reported a total income of Rs 20,740.03 crore in the first three quarters, compared to Rs 18,616.14 crore in the same period last financial year.

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HDFC Bank net jumps 30% to Rs 1,859 cr

HDFC Bank has reported a 30 per cent increase in net profit at Rs 1,859 crore for the third quarter ended December 31, 2012 against Rs 1,430 crore in the year-ago period.

The private sector lender has posted a 22 per cent rise in total income at Rs 10,507 crore (Rs 8,623 crore). Total expenditure increased 20 per cent to Rs 7,483 crore (Rs 6,245 crore),

Shares of HDFC Bank were trading at Rs 662.85 per share on the BSE, down 0.61 per cent over the previous close, on the BSE at 1.15 pm.

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IDBI to raise Rs 3k cr via QIBs, preference shares to govt

State-owned IDBI Bank today said it proposes to raise Rs 555 crore by issuing preference shares to the government, and up to Rs 2,500 crore from institutional investors.

The board has approved the proposal for preferential issue of equity capital aggregating Rs 555 crore — including premium — to the government, IDBI Bank said in a filing on the BSE.

Last fiscal, the government infused Rs 810 crore in the bank by way of preferential allotment of shares.

The bank said the board has also cleared raising capital up to Rs 2,500 crore by offering shares to Qualified Institutional Bidders (QIBs).

This is subject to regulatory and shareholder approvals, it added.

Earlier this month, the government approved infusion of Rs 12,517 crore in around 10 state-owned banks over the next three months.

“Pursuant to the Budget announcement made by the Finance Minister on March 16, 2012, we are infusing additional capital into the public sector banks. We will infuse before the end of this fiscal year a sum of Rs 12,517 crore,” the Finance Minister P Chidambaram had said.

“We think about 9-10 banks will get the money...this will enable the banks to maintain the Tier I CRAR (capital to risk—weighted assets ratio) at a comfortable level and will be compliant to stricter capital adequacy norms of Basel III whenever Basel III is implemented,” he had said.

The government infused about Rs 20,117 crore in the public sector banks during 2010-11, and Rs 12,000 crore in 2011-12.

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SEBI clears Bajaj Finance rights issue plan

Market regulator SEBI has given its go-ahead to the non-banking finance company Bajaj Finance’s proposed rights issue to raise up to Rs 750 crore.

In a rights issue, shares are issued to the existing investors as per their holding at a pre-determined price and ratio.

Bajaj Finance had filed draft documents with SEBI in November to raise up to Rs 750 crore through a rights issue.

SEBI issued its final observations on the draft offer documents on January 8 as per the latest update by the market regulator.

Bajaj Finance, a subsidiary of Bajaj Finserv, is engaged in the business of consumer finance, SME finance and commercial lending.

The company plans to use the proceeds of the issue for strengthening its capital base.

JM Financial Institutional Securities is acting as lead manager to the issue, while Karvy Computershare is the registrar.

Earlier in August, SEBI had given its approval to Bajaj Finserv to raise up to Rs 1,000 crore through rights issue.

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Muthoot Finance Q3 net up 7.65 % at Rs 270 cr

Muthoot Finance Ltd has registered a 7 per cent growth in its net profit in the third quarter of FY13 at Rs 270 crore, against Rs 251 crore last year. Total income for the period also grew by 11 per cent at Rs 1,365 crore against Rs 1,230 crore.

For the nine-month period ended December 31, the company registered a 19 per cent growth in its net profit to Rs 784 crore compared to Rs 657 crore the previous fiscal.

Total income stood at Rs 3,976 crore compared to Rs 3,255 crore — a growth of 22 per cent.

Retail Loan Assets Under Management increased by Rs 1,969 crore to Rs 25,712 crore during Q3 FY13. The branch network also witnessed a 12 per cent growth in the nine-month period, reaching 3,914 against 3,480 in the corresponding period.

M. G. George Muthoot, Chairman, said the company has been able to register a growth of Rs 1,969 crore in its asset under management against a de-growth of Rs 1,337 crore in the first quarter, and a growth of Rs 405 crore in the second quarter. It signifies the beneficial fall out of the strategic steps the company has taken to address the regulatory restrictions imposed on gold loan NBFCs, he said.

The company, he said, has obtained the approval of shareholders through postal ballot to raise the public holding of its shares to 25 per cent from the current 19.88 per cent, to follow the SEBI stipulation of a minimum public holding of 25 per cent by May 2014. George Alexander Muthoot, Managing Director, said the negative perception created in the minds of the public about gold loans has been dispelled by the KUB Rao committee report. With this report, it is clear now that gold loans are a useful product for the society and the financial inclusion NBFC bring in, he said.

“There are certain ‘hygiene measures’ to be followed by NBFCs in this space which we will try to ensure compliance through our self regulatory body Association of Gold Loan Companies (AGLOC) to its members,” he said.

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R.K. Dubey is Canara Bank CMD

R.K. Dubey, 59, has been appointed the Chairman and Managing Director of Canara Bank. He assumed charge on Friday.

A press statement from the bank said Dubey’s was areas of expertise include planning and budgeting, resource mobilisation, credit, risk management, human resources (HR), IT and marketing. A post-graduate in English, Dubey also has a degree in law and management in HR practices. He is also a certified associate of the Indian Institute of Bankers. Dubey joined Punjab National Bank in 1977 as a management trainee and moved up the ranks to become a general manager in 2008 and was appointed as executive director of Central Bank of India in 2010.

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Bank of Baroda sees no change in bad loans

Public sector lender Bank of Baroda doesn’t see significant improvement in the asset quality and restructured book in the near term unless growth picks up, a top bank official has said.

“We have seen some improvement on the bad asset front but not great improvement. For significant improvement to happen, we need growth to pick up,” BoB executive director P. Srinivas told PTI.

He also said the NPA (non-performing asset) numbers may be at the same level as reported in the second quarter of the current financial year.

BoB’s gross NPAs stood at 1.98 per cent in the second quarter and net NPAs at 0.82 percent.

On the restructured accounts, Srinivas said things may not significantly improve on the restructured accounts front in the third quarter as well.

The bank had restructured around Rs 950 crore of loans in the second quarter.

Credit growth

Asked about credit growth, Srinivas expressed the hope that the bank would be able to close the year with a credit growth of 19-20 per cent driven by a good show by the retail segments.

“Retail loan book will grow faster this fiscal while we expect corporate loan growth to be subdued,” Srinivas said.

The public sector lender, which has asked for Rs 1,500 crore infusion from the Government, also said there is no intimation from the Government with regard to the quantum of infusion for the bank.

“We have asked for Rs 1,500 crore for this fiscal.

But, we don’t know what will be the amount that will come in from the Government,” Srinivas said.

Late last week, the Government had announced an infusion of Rs 12,517 crore into public sector banks to boost their capital adequacy ratios and to support business growth.

Bank of Baroda posted 11.6 per cent rise in its net profit at Rs 1,301.39 crore in the July-September quarter. Its total income rose 19.6 per cent to Rs 9,550.86 crore.

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Banks want PAN rule relaxed for non-deduction of tax at source

Banks want the revenue authorities to do their depositors, who are economically weak, aged and infirm, a good turn.

They have moved the authorities to allow them to act upon self-declarations made in Form 15G and Form 15H (for non-deduction of tax at source) by the above mentioned category of people even if they do not have a permanent account number (PAN).

Banks, under the aegis of the Indian Banks’ Association, have impressed upon the Finance Ministry (the department of revenue functions under the ministry) that such a move will alleviate the hardship caused to the economically weaker sections, the aged and the infirm.

Further, this would also reduce the administrative burden to the authorities granting income-tax refunds.

Currently, in the absence of PAN, declarations for non-deduction of tax at source in Form 15G or in Form 15H cannot be acted upon and interest earned by the economically weaker sections, the aged and the infirm becomes subject to tax deduction at the higher rate of 20 per cent.

Mandatory

If a depositor furnishes PAN, then banks deduct tax at source at 10 per cent on the interest earned on fixed deposits, if it (the interest earned) is above Rs 10,000 a year.

PAN has been made compulsory for every transaction with the income-tax department.

The number is also mandatory for a number of other financial transactions, including opening of bank accounts, availing institutional financial credits, purchase of high-end consumer item, foreign travel, transaction of immovable properties, and dealing in securities.

Identification

A PAN card is a valuable means of photo identification accepted by all government and non-government institutions in the country.

Form 15G is a self-declaration form submitted by individuals below 60 years to banks stating that their income is below the taxable limit. Form 15H is submitted by those above 60.

Hike in TDS limit

Meanwhile, banks have sought a hike in the tax deducted at source limit on interest earned on fixed deposits from Rs 10,000 to Rs 50,000 a year.

This hike in the tax deducted at source limit on interest earned on fixed deposits would be in line with rationalisation of tax slabs in the draft Direct Taxes Code and take into account the impact of inflation on returns.

Such a move would reduce considerable paperwork and manpower, both at banks and at the income-tax department.

Ramkumar.k@thehindu.co.in

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Raj Kumar Goyal takes over as ED, Central Bank of India

Raj Kumar Goyal has taken charge as Executive Director of Central Bank of India. His appointment is effective from January 11.

Goyal comes in place of Rajeev Kishore Dubey, who has taken over the reigns of Canara Bank as its Chairman & Managing Director.

The new Central Bank of India ED was previously with Bank of India as General Manager, Human Resources Development.  He has more than 35 years experience in banking having worked in the areas of credit, human resources, general operations and international banking at Bank of India’s London branch.

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