HDFC to invest in Kaizen

Housing Development Finance Corporation, the country’s leading home mortgage provider, will invest in Kaizen asset management company, the manager for India’s first education-focused private equity fund, Kaizen Private Equity.

HDFC will invest in the education sector through its wholly owned subsidiary, HDFC Holdings Ltd, said a press release.

While the deal size was not disclosed, sources said HDFC would appoint an official on the board of Kaizen. HDFC will also get a share of profit of the asset management firm.

Kaizen asset management company plans to manage a $100-million target fund, which has commitments from leading international institutions. The fund achieved a first close in India in December 2010 and has used the proceeds to make its first investment in an undisclosed company, said the release.

“This partnership is complementary, as it leverages HDFC’s presence and strengths with the significant domain expertise provided by Kaizen’s in-house team,” said Sandeep Aneja, founder and managing director of Kaizen PE.

Kaizen would continue to enjoy independence in making investment decisions for Kaizen PE, as well as in the day to day management and operations of the asset management company, he said.

“Private equity investment in the education sector can catalyse entrepreneurship and support companies that wish to provide quality education at affordable prices”, said V S Rangan, executive director of HDFC.

India’s education sector market size is valued at $86.2 billion (Rs 3.9 lakh crore). While the government spends about $30 billion annually on the sector, the private sector spends about $43.2 bn.

Source: Business Standard

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HDFC Bank banks on 3G services to boost mobile banking share

HYDERABAD: HDFC Bank aims to increase its mobile banking share, which is below 5 per cent currently, to 10 per cent in Andhra Pradesh once 3G services are fully rolled out in the state, said a senior official.

The leading private lender is also set to open 34 new branches in the state before the end of this financial year, taking their total number to 137.

"It (mobile banking) is still in the nascent stage. It has to go a long way. After facilities like 3G services are launched, it is expected to reach 10 per cent. Currently mobile banking is around 3 to 5 per cent," CS Gopinath, Senior Vice-President, HDFC Bank, told PTI.

He said the aim is to encourage customers to go for more technology-based services like ATM , mobile and Internet banking.

According to Gopinath, only 26 per cent of HDFC Bank's customers visit its branches and rest depend on ATMs, Internet and mobile for their banking needs. "We have 450 to 500 ATMs in AP and up to 20 per cent customers use Internet banking."

He said they are planning to open 34 new branches in the state by the end of this fiscal.

"Currently, we have 103 branches in AP. We plan to open another 34 by the end of this financial year, taking the number of branches to 137. In Karnataka we have close to 100 branches and in Kerala 150. In Tamil Nadu we have 135 branches," he informed.

Source: EconomicTimes

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Rural post offices may set up ATMs

NEW DELHI: The government may allow post offices to set up automated teller machines, or ATMs , at rural areas, in an attempt to further strengthen the role of India Post in financial inclusion.

India Post, which is working on major improvements in the payment process for social sector schemes like NREGA, will set up ATM networks in selected areas to give people access to online banking services.

"Central, state and local governments are increasingly preferring government benefit payments to be routed through banks rather than using postal services. We need to innovate so as to continue to play dominant role in financial inclusion," said a senior official with ministry of communications and information technology.

According to the official, the move to provide ATM services to its account holders will put them on a par with banks and other financial institutions working in this space and further strengthen their case for a banking licence.

Earlier, a committee on micro finance and poverty alleviation working under the aegis of Planning Commission had also suggested setting up of Gramtells (rural ATMs) at Post Offices. At present, only 45% of the Indian population has access to basic banking services.

The Postal Department, with its 1.55 lakh branches, already offers a host of financial services such as life insurance. "We are working towards convergence of the reach of Postal Offices with the government's financial inclusion agenda," said the official.

The plan for integration between different arms of the government on financial inclusion was also discussed in a meeting of the Committee of Secretaries, held last week.

"Various mechanisms have been proposed (for convergence) and are being discussed," confirmed a finance ministry official. The government is looking at opening five crore accounts in the selected 73,000 villages having a population of up to 2000, by March 2012.

By-Economic Times

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IOB to get Rs 1,054 cr capital infusion from govt.

State-owned Indian Overseas Bank (IOB) said the government has decided to infuse Rs 1,054 crore into the bank as part of recapitalisation package.

The capital infusion is aimed at shoring up equity base of the bank to enhance lending to productive sectors of the economy.

The government has decided to infuse Rs 1,054 crore into the bank by way of preferential allotment of the equity, IOB informed the Bombay Stock Exchange in a filing.

During the year, the government has approved capital support for 8 public sector banks and more banks are likely to get infusion soon.

Other lenders who would get funds from the government includes UCO Bank, United Bank of India, Corporation Bank, Dena Bank, Allahabad Bank, Bank of Maharashtra and Vijaya Bank.

It is to be noted that Finance Minister Pranab Mukherjee announced capital infusion of Rs 15,000 crore into public sector banks during the current fiscal to ensure that these entities are able to attain a minimum 8 per cent Tier-I capital by March 31, 2011.

As part of recapitalisation, the government had infused Rs 6,211 crore into five banks. The banks, which had got capital support from the government in the first tranche included Union Bank of India, Bank of Maharashtra, IDBI Bank, UCO Bank and Central Bank India.

Besides, the government also approved additional capital infusion of Rs 6,000 crore in 10 public sector banks with an objective to raise its holding to a minimum 58 per cent in all state-run banks.

The proposed capital infusion is to enhance the lending capacity of the state-owned banks to meet the credit requirement of the economy in order to maintain and accelerate the economic growth momentum.

Source: FinancialExpress

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PNB (International) opens 6th branch in UK

Within four years of commencing operations in the UK, Punjab National Bank (International) Ltd has opened its sixth branch here and expects to chart a growth of 30 to 35 per cent in its business during the current financial, Managing Director S R Sharma has said.

Speaking at the Clay Oven banquet hall after High Commissioner Nalin Surie inaugurated the branch in Wembley, Sharma said, "The bank has more than 22,000 customers and total business (customer deposits and advances) of nearly USD 1.20 billion."

"The bank is expecting a growth of 30-35 per cent in its customer business during the current financial year, ending March 2011," Sharma added.

He said the bank plans to open another branch at Wolverhampton in future.

Tracing the 115-year-old history of Punjab National Bank and its journey from Lahore -- the capital of undivided Punjab before Partition -- to Wembley, Sharma said PNB has a customer base of around 60 million and a business worth Rs 5,00,000 crore in India.

The Bank has a presence in nine countries abroad, including the UK subsidiary.

High Commissioner Surie, who had inaugurated the fifth branch of PNBIL at Ilford in April, 2010, spoke about the Indo-British business partnership and how Indian banks are contributing toward the growth of the British economy and enhancement of bilateral trade.

He wanted Indian banks to help businesses in UK and also promote investment from the UK to India.

He also lauded the contribution of British Indians to the economy.

Harbhajan Singh, the Mayor of the London Borough of Brent and Brent North MP Barry Gardiner were the guests of honour at the inauguration.

Singh welcomed the bank to the borough of Brent and hoped it would work closely with the local community.

He assured support and cooperation to the bank for its operations.

Gardiner appreciated the role of the Indian community and Indian banks and how they are contributing to the development of Brent.

The event was attended by around 150 prominent British Indians and other local residents of London, heads of other Indian banks and financial institutions and representatives of local social and religious organisations.

Source: Financial Express

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