IDBI Bank, International Cars tie-up for auto finance

IDBI Bank announced tie-up with Passenger Car Business unit of International Cars & Motors Limited (ICML) to provide auto finance to its customers.

As per the scheme modalities, ICML and its dealer network will collaborate with IDBI Bank for the purpose of retail activation in order to facilitate vehicle financing business, the bank said in a statement.

The Bank would extend financing facilities to eligible customers for purchasing Multi Utility Vehicle of ICML ‘Extreme’.

Source: thehindubusinessline

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Dhanlaxmi Bank Jan-Mar quarter net at Rs 28.66 cr

Private sector lender Dhanlaxmi Bank posted net profit of Rs 28.66 crore for the last quarter ended March 31 of 2012-13.

The South-India based bank had reported a net loss of Rs 86.51 crore over the same quarter (January-March) in the previous fiscal.

Total income of the bank during the fourth quarter of 2012-13 was marginally higher at Rs 369.25 crore, from Rs 365.42 crore a year ago, it said in a filing to the BSE.

For the full year 2012-13, the bank posted net profit of Rs 2.62 crore. The lender had made a loss of Rs 115.63 crore in 2011-12 fiscal year.

Total income in the FY13 fell to Rs 1,422.30 crore from Rs 1,537.30 crore in FY12.

Bank’s net non-performing assets (NPAs) or bad loans rose to 3.36 per cent in the fourth quarter 2012-13, from 0.66 per cent a year earlier.

Gross NPAs increased to 4.82 per cent during the quarter under review, from 1.18 per cent a year ago.

In absolute terms, net NPAs stood at Rs 261.02 crore during January-March from Rs 58 crore a year ago. Gross NPAs during this period were at Rs 380.27 crore versus Rs 104.27 crore.

Shares of the bank today closed at Rs 46.45 apiece on the BSE, up 0.11 per cent from the previous close.

Source: thehindubusinessline

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RBI auctions 10-year bond worth Rs 7,000 cr

The Reserve Bank of India on Friday auctioned a new 10-year benchmark government bond worth Rs 7,000 crore at a cut-off yield of 7.16 per cent.

The bond, which will matures in 2023 and carries a coupon rate of 7.16 per cent, will be the new benchmark paper in place of the existing 8.15 per cent bond, which matures in 2022. After the issue, the yield of the 7.16 per cent 2023 government bond ended at 7.16 per cent in the market.

According to N. S. Venkatesh, Head of Treasury, IDBI Bank, the cut-off yield shows that the 10-year paper was very well bid. “The market has already discounted at least 25 basis point (bps) cut in repo rate in the RBI’s mid quarter monetary policy which is due in June.”

“Till the policy is announced, the yield (on the new 10-year paper) may fall further to 7.05 per cent levels,” he said.

The yield on the current 10-year benchmark bond 8.15 per cent, maturing in 2022, ended at 7.40 per cent compared with Thursday’s close of 7.39 per cent. During intra-day trades the yield had dropped to 7.32 per cent.

However, the yields edged up after global rating agency Standard & Poor’s gave a negative outlook on India's long-term rating. The benchmark bond yields have fallen over 50 bps beginning this April. The yields fell on account of easing of the latest WPI inflation for April to 4.89 per cent, which compares favourably with the RBI’s comfort level of 5 per cent.

beena.parmar@thehindu.co.in

Source: thehindubusinessline

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Manappuram Fin profit slips 65% in FY13

The net profit of Manappuram Finance has dropped 64.76 per cent to Rs 208.40 crore in FY13 against Rs 591.46 crore in the previous fiscal.

The company attributes this to under-recovery of interest amounting to Rs 284.20 crore on a specific pool of its portfolio that was booked during the third quarter of FY12. The company has also made an additional provision of Rs 51.40 crore towards reversal of interest booked in FY12.

According to a statement issued here, the company said it faced a higher incidence of defaults in this pool after it began realigning its portfolio under the new loan-to-value regime brought into effect in March 2012. The additional provisioning, it said, is a prudential measure that considers the further fall in gold prices during April this year. The interim dividend of Rs 1.50 per share of face value of Rs 2, already declared during the year, has been recommended as the final dividend for the year ended March 31.

V. P. Nandakumar, Managing Director and CEO, said, “…Our company has faced considerable stress last year on account of policy changes and market forces. However, this is a temporary phase unlikely to hold back the company or the industry beyond the short term,” he said.

sajeevkumar.v@thehindu.co.in

Source: thehindubusinessline

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Oriental Bank cuts FD rates up to 1%

State-owned Oriental Bank of Commerce (OBC) slashed fixed deposit rates by up to 1 per cent on select maturities.

The announcement comes on the heels of RBI cutting key policy rate by 0.25 per cent earlier this month.

The fixed deposit rate for maturities ranging from 31-45 days has come down to 6 per cent from 7 per cent, OBC said in a statement.

At the same time, term deposit of 180-269 days will earn 0.5 per cent lower interest rate at 8 per cent from earlier rate of 8.50 per cent, while interest rate on 91-179 days has come down by 0.25 per cent at 7.75 per cent.

However, interest rate on 46-90 days deposit remains unchanged at 7 per cent.

The revised FD rates effective will apply to deposits below Rs 1 crore, it said.

The central bank lowered the short-term lending (repo) rate to 7.25 per cent from 7.50 per cent, lowest since May 2011 while retaining the cash reserve ratio for banks unchanged at 4 per cent.

Source: thehindubusinessline

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HSBC focused towards making more cost savings by 2016

Asia-focused bank HSBC announced that it will make another $2-3 billion of new cost savings by 2016, extending its restructuring plans.

The lender said in a statement that it will seek the additional sustainable cost savings on top of its wide-ranging restructuring process that was launched in 2011.

HSBC revealed last week that it had slashed a total of $4.0 billion from its annual costs, axing about 46,000 jobs since 2011 as part of a vast restructuring.

“We have transformed HSBC in the first phase of the execution of our strategy,” said chief executive Stuart Gulliver in today’s strategy update.

“We have announced the closure or disposal of 52 non-strategic or underperforming businesses, achieved $4.0 billion of annualised sustainable cost savings and generated double-digit loan growth in 15 priority markets.

“HSBC is now simpler, easier to manage and ready to take advantage of growth opportunities.”

HSBC announced last week that first-quarter net profits more than doubled to $6.35 billion, aided by sliding bad debts, deep cost cutting and a solid performance in Britain and Hong Kong.

Last year, however, HSBC had posted a 16.5-percent slump in net profits as it was hit by US money-laundering fines, mis-selling scandals, rising taxation and a vast accounting charge.

Source: thehindubusinessline

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Jammu & Kashmir Bank Q4 net profit up 20% at Rs 250 cr

Jammu & Kashmir Bank registered 20 per cent rise in net profit at Rs 250 crore for its fourth quarter ended March 31, 2013.

The bank had recorded a profit of Rs 208.1 crore in the same period of the previous fiscal, Jammu & Kashmir Bank said in a filing to the BSE.

Total income of the bank rose to Rs 1,835.71 crore in January-March quarter as compared to Rs 1,479.81 crore in the same period during the previous fiscal.

The bank proposed a dividend of 500 per cent, or Rs 50, per share for 2012-2013.

For the entire fiscal, the bank’s net profit increased by 31 per cent at Rs 1,055.10 crore, compared to Rs 803.25 crore in 2011-12.

Total income increased to Rs 6,620.53 crore during the year, compared to Rs 5,169.70 crore in the previous fiscal.

Gross non-performing assets (NPAs), as a proportion of advances, rose to 1.62 per cent at the end of March 2013, as against 1.54 per cent in the previous fiscal. However, net NPAs declined 0.14 per cent during the year from 0.15 per cent at the end of March 2012.

Source: thehindubusinessline

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Karnataka Bank net up 41.4% in FY13 as recoveries improve

Despite a 18.96 per cent decline in net profit during the fourth quarter, Karnataka Bank’s profit in fiscal 2012-13 grew 41.45 per cent.

The bank recorded a net profit of Rs 67.39 crore in the fourth quarter of 2012-13 against Rs 83.16 crore in the year-ago period.

P. Jayarama Bhat, Managing Director and Chief Executive Officer of the bank, attributed the decline to higher provisioning in the fourth quarter.

The provision coverage ratio has gone up from 47.18 per cent to 55.36 per cent, he said.

The provision for income-tax came to around Rs 31 crore (Rs 23 crore). With this, the total provision went up to Rs 86 crore, he said.

FY13 performance

However, the bank posted a net profit of Rs 348.08 crore in 2012-13 as against Rs 246.07 crore in the previous year, a growth of 41.45 per cent.

Terming this net profit as an all-time high, Bhat attributed it to the growth in advances and good recovery in NPAs (non-performing assets).

“We could reduce the NPAs. We made a total recovery of around Rs 459 crore during the year.

“Of that, we sold assets worth around Rs 100 crore to asset reconstruction companies, and made real recoveries of around Rs 175 crore,” he said, adding that accounts of Rs 75 crore were upgraded and gross NPAs were brought down from Rs 684 crore to Rs 634 crore. Bhat said the bank wants to reduce the gross NPAs to around 2 per cent and net NPAs to below 1 per cent during 2013-14. The bank has set a business growth target of 28 per cent during the current fiscal.

DIVIDEND

The board of directors has recommended a dividend of 40 per cent.

This works out to Rs 4 per equity share. On Wednesday, the Karnataka Bank scrip closed at Rs 159.95 on the BSE, up 2.99 per cent over the previous close of Rs 155.30

vinayak.aj@thehindu.co.in

Source: thehindubusinessline

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Bank of Baroda Q4 net down 32% as NPAs rise

Bank of Baroda’s fourth-quarter net profit dropped by about a third as it set aside more money to cover potential loan losses.

For the January-March quarter, the public sector bank’s net profit decreased to Rs 1,029 crore from Rs 1,519 crore, a year ago.

The bank set aside Rs 1,598 crore to cover potential loan losses in the quarter, up from Rs 844 crore it set aside in the same period last year.

Slippages during the reporting quarter increased 79 per cent to Rs 7,983 crore from Rs 4,465 crore in the corresponding quarter last year.

BAD DEBTS

The rise in non-performing assets (NPAs) in the quarter was due to poor performance of the bank’s overseas portfolio from where the bank gets about 29 per cent of its total business. The bank’s overseas NPA increased to Rs 880 crore in the quarter ended March from Rs 225 crore, a year ago.

“Domestic NPAs will stabilise around the current levels for the next two quarters, after which it will improve,” S. S. Mundra, Chairman and Managing Director, said.

Slightly over 50 per cent of the new slippages during the quarter came from the corporate loan portfolio, reflecting prolonged industrial slowdown.

The bank said it wrote off loans worth Rs 1,200 crore in the quarter.

The bank restructured loans worth Rs 2,843 crore in the quarter ended March 31,2013, compared with Rs 5,280 crore in the same period last year, Mundra said.

Mundra said that the bank’s deposit and credit growth will be about two per cent more than the industry average.

The RBI, in its annual policy on May 3, said it expects deposits of scheduled commercial banks to grow at 14 per cent and credit growth at 15 per cent in the FY’2014.

The bank’s board has recommended a dividend of Rs 21.50 per equity share. The bank’s peers in the public sector also saw a decline in quarterly net profit due to higher provisions. Punjab National Bank’s Q4 net dropped 21 per cent, while Canara Bank’s Q4 net dropped 12.5 per cent. India’s largest lender, State Bank of India, will declare its quarterly and annual results on May 22.

Shares of the bank closed at Rs 691.85, down 1.82 per cent, on the Bombay Stock Exchange.

satyanarayan.iyer@thehindu.co.in

Source: thehindubusinessline

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BoI net drops 21% as bad loan provisioning doubles

Higher provisioning and lower margins weighed on Bank of India’s profitability in the fourth quarter ended March 31, 2013.

The public sector bank’s net profit fell 21 per cent in the reporting period to Rs 757 crore. The decline in profit came despite a prudential write-back of Rs 192 crore on account of taxation.

Net interest income (difference between interest earned and expended) declined marginally to Rs 2,476 crore.

Provisions towards bad loans more than doubled to Rs 1,089 crore during the quarter.

Net interest margin fell to 2.46 per cent. “The bank expects NIM to improve to about 3.10 per cent on the back of lower cost of deposits and improvement in international margins to about 1.20 per cent,” said Vijayalakshmi R. Iyer, Chairperson and Managing Director.

Net profit for FY13 nudged up three per cent to Rs 2,749 crore against Rs 2,677 crore in FY12.

Gross non-performing assets ratio increased to 2.99 per cent from 2.34 per cent in March quarter of FY12. For Bank of India, NPA levels have peaked, said Iyer.

Loan restructuring

The bank restructured loans worth Rs 2,159 crore in Q4 FY13. “Restructuring in the June quarter this fiscal is expected to be about Rs 515 crore. Going forward, stress in the loan portfolio will be lower,” Iyer said.

Against an exposure of Rs 650 crore to the beleaguered Kingfisher Airline, the bank has recovered Rs 53 crore through share sale in the recovery process.

Further, the bank will go for qualified institutional placement in the second half of FY14. “We will require capital worth about Rs 6,000 crore, of which, Rs 3,000 crore will be ploughed back from profits. Hence, about Rs 3,000 crore will be raised, including capital infusion from the Government,” Iyer added.

The board recommended a dividend of Rs 10 per share in FY13.

Bank of India’s scrip ended 4.35 per cent lower at Rs 324.25 per share on Bombay Stock Exchange.

beena.parmar@thehindu.co.in

Source: thehindubusinessline

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Ratnakar Bank opens branch in Chennai

Maharastra-headquartered private sector Ratnakar Bank Ltd opened its branch in the city as part of its expansion plan.

The bank has a strong presence in Karnataka, Goa and was growing in other regions like Gujarat, NCR, Madhya Pradesh, Haryna, Uttar Pradesh, Andhra Pradesh, Rajsthan and Union territory of Daman and Diu, bank’s CEO and Managing Director Vishwavir Ahuja said.

He said the bank plans to achieve a pan India footprint.

The bank’s business volume was around Rs 15,000 crore as on March 31, 2013, he added.

Source: thehindubusinessline

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Syndicate Bank hopes to reduce bad loans by 20% this year

Syndicate Bank has drawn up a strategy to bring down non-performing assets. “We are implementing stressed tiny assets recovery programmes, besides offering one-time settlements by conducting ‘Synd Adalats’ every quarter to reduce NPAs by 20 per cent this year,” the bank’s Executive Director M. Anjaneya Prasad told newspersons here on Monday.

The Bangalore-based bank’s gross and net NPA levels fell in the financial year ended March 31, 2013, compared to the previous year.

They came down from 2.35 per cent to 1.99 per cent and 0.96 per cent to 0.76 per cent respectively.

The regional offices were given specific targets on recovery which were being closely monitored, he added.

GROWTH

In the current financial year, Syndicate Bank is targeting 25 per cent growth in total business. In the last financial year, it logged 18 per cent growth in business at Rs 3.34-lakh crore and a net interest margin of 3.19 per cent.

Increased focus on retail, micro, small and medium enterprises and mid-corporates will be the key drivers to achieve the projected growth. The NIM for the full year could be above 3 per cent, he added.

The process of restructuring stressed assets is also going on. As on March, 2013, assets worth Rs 9,125 crore were restructured. “Assets worth t Rs 200-300 crore may be restructured in the next quarter,” the official said.

naga.gunturi@thehindu.co.in

Source: thehindubusinessline

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Vijaya Bank cuts housing loan rates

Vijaya Bank has reduced rate of interest on housing loans.

The bank, in a release, said to increase retail lending and give thrust to home loan portfolio, bank has launched a ‘Summer Bonanza Special Campaign’ running up to June 2013.

The rate of interest on home loans has been reduced up to the extent of 75 basis points in certain slabs.

The Processing and documentation charges have been fully waived. Maximum repayment period is increased from 25 years to 30 years.

For loan amount less than Rs 75 lakh, rate of interest linked to base rate (floating) is 10.25 per cent per annum and EMI per lakh is Rs 896.

For loans Rs 75 lakh and above, rate of interest linked to base rate (floating) is 10.50 per cent per annum and EMI per lakh is Rs 915.

Source: thehindubusinessline

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Allahabad Bank to trim NPAs

Public sector lender Allahabad Bank aims to bring down its gross non-performing assets (NPAs) level to around 3.2 per cent from the last fiscal’s level of 3.92 per cent on the back of sustained effort on recovery, a top bank official has said.

“As far as asset quality is concerned, we aim to bring down our gross NPAs to around 3.2 per cent by end of this fiscal from 3.92 per cent in FY13,” chairman and managing director Shubhalakshmi Panse told PTI over the weekend.

She also said the bank is monitoring bad accounts on a daily basis along with focus on recovery. “We aim to recover Rs 2,800-3,000 crore in the current fiscal from Rs 2,300 crore done last fiscal,” Panse said.

The bank chief also said the possibility of upgrade of accounts would be more with economic growth.

Last week, Allahabad Bank had reported a 68.5 per cent decline in net profit at Rs 126.15 crore in the fourth quarter of last fiscal on account of rise in bad loans.

Referring to the cost of funds for the bank, Panse said with re-pricing of bulk deposits, it had already come down in Q4 and is likely to go down further.

She also said the growth of low cost deposit (Casa) is good for the bank and it hopes to sustain it in the current financial year.

The bank had a Casa (current account, savings account) ratio of around 31 per cent by end of the past fiscal. Panse, however, said it has little room for reduction in lending rates as it had already done so in February and its current lending rates are competitive.

On the issue of growth in loan book, she said while corporate loan book will see good growth, the bank wants to increase its retail assets.

“We aim to increase our retail loan book to 15 per cent from present 13.5 per cent,” Panse said.

Source: thehindubusinessline

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Corp Bank plans rural expos to boost agri credit

To boost its agriculture credit portfolio, Corporation Bank will conduct rural expos across the country during May.

Addressing presspersons here on Saturday, Ajai Kumar, Chairman and Managing Director of the bank, said that the bank wants to create village-level awareness on various products and services through such expos.

Each zone of the bank will be conducting a minimum of 10 rural expos. The bank has 31 zones. It is proposed to conduct more than 300 such rural expos across the country, he said.

With rural expos, the bank expects to generate good amount of business.

Such an expo will give more visibility in Ajai Kumar said that the bank witnessed a growth of Rs 2,326 crore in agriculture credit during 2012-13.

The agriculture credit portfolio of the bank stood at Rs 9,466 crore in 2012-13 as against Rs 7,140 crore in 2011-12.

He hoped that the bank will be able to double than what it had done in agriculture credit disbursement in 2012-13 with such initiatives.

The bank is also planning to increase its presence in rural areas during the current fiscal. Ajai Kumar said that the bank is planning to open a total of around 300 branches during 2013-14.

One-third of them, or around 100 branches, will be opened in rural areas during the current financial year, he said.

vinayak.aj@thehindu.co.in

Source: thehindubusinessline

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