HDFC Bank hikes lending rate by 25 bps

Mumbai: The second largest private sector lender HDFC Bank today followed its bigger peers to increase the base rate by 25 basis points to 9.5 percent and benchmark prime lending rate to 18 percent, a source familiar with the development told PTI.

"The new rates will be applicable from tomorrow," the source said. The bank has also increased it deposit rate for the one-year-16 days bucket by 75 bps to 9.25 from 8.50 percent.

Earlier in the day, public sector lender Bank of India and the small-sized South-based lender Dhanlaxmi Bank also hiked their minimum rate of lending or the base rates by 25 bps each.

While Bank of India today increased lending rates by 25 bps to 10.25 percent, Dhanlaxmi also jacked up rate by a similar quantum to 10.25 percent, taking its benchmark lending rate dearer by 25 basis points to 19.25 percent. The private lender has also increased the deposit rate on select maturities by 100 bps.

Almost all the lenders have increased their rates by 25 bps after the RBI increased the key policy rates by 25 bps at its mid-quarter review on July 16, which was the 10th successive hike since March 2010, to tame inflation.

On July 7, the country's largest lender State Bank had ncreased its lending rates by 25 bps to 9.5 percent and raised deposit rates by up to 100 bps. The bank had also raised its benchmark lending rate to 14.25 percent.

ICICI Bank, Indian Overseas Bank, Corporation Bank, Dena Bank, Canara Bank and Bank of Baroda have been among those who have raised their lending rates.

Source: Financial Express

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BoB to open 10-12 overseas branches in FY12

NEW DELHI: Public sector lender Bank of Baroda (BoB) plans to open 10 to 12 overseas branches in the current fiscal.

"We have plans to open another 10 to 12 branches in the current financial year in our various overseas territories. That would take our branch and office network abroad to around 100 by March, 2012, Bank of Baroda CMD M D Mallya said here.

Elaborating on the geographical positioning planned for these new branches, Mallya said: "It could be in East African countries Kenya, Uganda, Tanzania , Botswania.

We would be opening a joint venture company in Malaysia. We are expecting a licence in Australia. We are opening a couple of branches in our New Zealand subsidiaries and maybe a couple of outlets in the Gulf region".

However, he admitted that the bank has witnessed moderation in credit growth in the April-June quarter of 2011.

"This year, we are in the slack season as of now. As far as the first quarter is concerned, if you compare it with the figures of March, the credit growth may not be too high. It could be in the range of about 4 to 5 per cent, which on an annualised basis would work out to be 16-17 per cent."

However, as far as Bank of Baroda is concerned, our credit growth has been 24 per cent year on year, he added, explaining the limp in credit growth witnessed by the bank.

Source: EconomicTimes

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3 PSU banks raise lending rates by up to 50 bps

NEW DELHI: Three public sector lenders, including Andhra Bank, raised their base rates or the minimum lending rates by up to 50 basis points making housing, auto and other loans more expensive.

The bank has decided to raise its base rate by 25 basis points to 10.25 per cent from 10 per cent effective from tomorrow, Andhra Bank said in a statement.

Besides, the bank has raised its Benchmark Prime Lending Rate (BPLR) by 25 basis points as well to 14.50 per cent, making existing loan expensive by at least 25 basis points.

Meanwhile, the largest associate bank of SBI, State Bank of Bikaner and Jaipur raised its base rate by 50 basis points to 9.75 per cent from 9.25 per cent.

Another associate bank, State Bank of Mysore , however, raised its base rate by 25 basis points to 9.75 per cent.

Rate hikes by banks comes in response to interest rate increase by the Reserve Bank last month in its mid-quarterly review of credit policy 2011-12.

The RBI hiked its key short-term lending and borrowing rates by 25 basis points (0.25 per cent) each with immediate effect to tackle inflation.

The short-term lending (repo) rate now stands at 7.5 per cent and the borrowing (reverse repo) rate at 6.5 per cent.

Source: EconomicTimes

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SBBJ raises lending rates by 50 bps

Jaipur: State Bank of Bikaner and Jaipur (SBBJ), a subsidiary of State Bank of India, raised both its lending rates by 50 basis points with effect from July 11.

The bank's revised base rate is now 9.75 per cent and the BPLR is 14.75 per cent per annum, a statement released by SBBJ said.

The announcement comes close on heels of SBI and private lenders ICICI Bank, Dhanlaxmi and Axis Bank, among others, raising their base rates. More banks are also likely to follow suit in a couple of days.

Source: Financial Express

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Yes Bank eyes 35 per cent CAGR

Kolkata: Private sector Yes Bank is eyeing a compounded annual growth rate (CAGR) of 35 per cent till 2015, a top official of the bank said.

“In the first six years of the bank, we have clocked a CAGR of 74 per cent. But now we have moderated it to 35 per cent (till 2015)", Managing Director and CEO of Yes Bank Rana Kapoor said.

With a present branch network of 255 across 170 locations in the country, Kapoor said that the target by 2015 would be 750 branches.

The balance sheet size of the bank stood at Rs 59,000 crore as of March 2011, he said adding the bank intended to raise it to Rs 1,50,000 crore by 2015.

Asked whether the bank would look for acquisitions to grow the balance sheet size, Kapoor forecast the bank to grow initially at 35 per cent CAGR.

Kapoor said the bank's balance sheet and profit and loss account are expected to be growing in tandem. The bank today opened its third branch in the city and adjoining Howrah.

The bank would shortly open branches in Nagaland and Manipur.

It has also applied to the RBI for opening a branch in Dubai International Financial Centre and a representative office in Abu Dhabi.

Kapoor said the bank had identified education, healthcare, hospitality and urban real estate as the potential sectors for lending.

He said that in education infrastructure, the bank would like to increase its exposure upto Rs 5000 crore amounting to five per cent of the total portfolio.

Kapoor said that the bank would also aggressively cater to the micro-finance institutions (MFIs).

“We want our exposure to MFIs to grow”, Kapoor told reporters here.

From the present level of Rs 290 crore, the exposure to this sector would increase to Rs 1500 crore, he said. About West Bengal, Kapoor said the bank's plan was to make the state its hub for the north-eastern region. The bank plans to ramp the number of branches in West Bengal to 30 by 2015.

Source: Financial Express

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