Kingfisher dues: United Bank of India files winding-up petition

In what is being seen as more trouble for the grounded Kingfisher Airlines, one of its creditors — United Bank of India — has filed a winding-up petition against United Breweries Holdings Ltd (UBHL). The petition is pending admission before the Karnataka High Court, it is learnt.

UBHL, which is the holding company of the UB Group, was the guarantor for the loans given by United Bank of India to Kingfisher Airlines (KFA).

United Bank is the first lender in the 17-bank consortium to seek winding up of the guarantor company (UBHL), after KFA defaulted. In comparison, the consortium headed by State Bank of India is looking to proceed directly against KFA for recovery of the dues, estimated at about Rs 7,000 crore.

United Bank of India has an exposure of close to Rs 400 crore to KFA, which includes pre-delivery payment (PDP) financing for aircraft as well as working capital financing.

As UBHL was not able to meet its liabilities arising from non-payment of dues by KFA, United Bank has moved the Karnataka High Court with a winding up petition, sources in the banking industry said.

If the Karnataka High Court were to admit the winding-up petition, then it could frustrate the revival attempts of the grounded airline, say bankers.

This is because the Director-General of Civil Aviation is unlikely to renew KFA’s licence unless the airline is able to produce a no-objection certificate from lenders such as banks and tax authorities. But, with a winding-up petition pending before a High Court, no banker is likely to give a no-objection certificate for the airline to restart operations, say some economy watchers.

There is also an opposite view that any majority support from bankers (on repayment of dues to them) could still tilt the scale in favour of a revival of the airline.

Srivats.kr@thehindu.co.in

ashwini.phadnis@thehindu.co.in

Source: thehindubusinessline

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Corporation Bank plans to test purity of gold pledged with ‘caratometers’

To ensure purity of gold pledged with it by borrowers, Mangalore-headquartered Corporation Bank is experimenting with caratometers at some of its branches.

With its gold loan portfolio jumping by almost 70 per cent jump in FY13 to about Rs 4,000 crore, the public sector bank is testing viability of the caratometer as a risk-mitigation tool, aimed at breaking the borrower-assayer (usually a local jeweller) nexus.

The caratometer, which is a scientific and non-destructive method of testing the purity of the precious metal, could be used for a confirmatory test (after the assayer gives his report on the quality of gold), thereby ensuring the purity of gold pledged with the bank by borrowers, said a senior official.

“If we are satisfied with the caratometers, which have been procured from a couple of vendors, then we could install them in the branches where the loan against gold business is high,” said a senior official.

Corporation Bank’s gold loan portfolio more than doubled to Rs 3,662 crore as of December-end 2012, against Rs 1,585 crore as at December-end 2011. In the first nine months of the current financial year, the bank’s gold loan portfolio swelled 70 per cent (or by Rs 1,546 crore).

For agriculture loans against gold, the bank charges 10.60 per cent interest for loans up to 12 months and 11.10 per cent for loans of 12-24 months.

For non-agriculture loans against the pledge of gold, the bank charges 11.60 per cent for loans up to Rs 2 lakh and 12.60 per cent for above Rs 2 lakh.

To further boost agriculture lending, the bank has opened ‘gold loan shoppe’ at seven places. The shoppe is an exclusive gold loan counter within the branch to provide quick and fast clearance of gold loans to customers against gold ornaments.

Ramkumar.k@thehindu.co.in

Source: thehindubusinessline

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IRDA asks life insurers to submit product planners by month-end

Life insurers will now have to submit their plans for launch of new products to the insurance regulator.

The Insurance Regulatory and Development Authority (IRDA) has directed all life insurance companies to submit a product planner 45 days before the beginning of every financial year.

For the current financial year, the product planners should be submitted before this month end.

The objective of the move is to speed up the product-approval process as there is a “huge” number of applications for new products, T. S. Vijayan, Chairman, IRDA, said in a circular issued on Monday.

“In order to expedite the product-approval process, the authority requires certain information from the insurers to plan for resources available,” he said.

As of now, the IRDA is seeking additional information, if required, from the insurers within 30 days of receipt of an application for product approval under ‘file and use’ procedures.

naga.gunturi@thehindu.co.in


Source: thehindubusinessline

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J&K Bank achieves Rs one lakh crore business

Jammu and Kashmir Bank said it has achieved the Rs one lakh crore business and expressed confidence of meeting its other annual targets as well.

Jammu and Kashmir Bank surpassed the target of the promised Rs one lakh crore business in Platinum Jubilee year amid firm belief to meet easily its other annual targets as well, bank’s Chairman and Chief Executive Officer, Mushtaq Ahmad said.

“It is a jubilation moment for all of us to celebrate in this Platinum Jubilee year,” the Chairman said.

Ahmad said the road ahead is “full of challenges” in view of the global financial conditions, slowing domestic economy and the testing work environment in the state.

“I am sure that all of us together will surmount these challenges and convert them into opportunities demonstrating our innate capacity to rise to the occasion,” he added.


Source: thehindubusinessline

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SKS Micro raises Rs 226 cr via securitisation deals, scrip gains

SKS Microfinance Ltd has concluded two secruitisation deals for Rs 226 crore.

With this, the Hyderabad-based company had completed 12 securitisation transactions with seven funding parters for Rs 1,207 crore in the financial year 2012-13 which ended on Sunday.

In addtion, SKS had also raised an incremental debt of Rs 1,680 crore for FY 13 and raised a fresh equity of Rs 263.5 crore. The total incremental fund flow stood at Rs 3,150 crore which is more than double the Rs 1,434 crore mobilsed in FY 12, the company said in a relase.

SKS Microfinance scrip gained 4.57 per cent after opening of trade on the Bombay Stock Exchange on Monday and is trading at Rs 127.10.

naga.gunturi@thehindu.co.in

Source: thehindubusinessline

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