Bank of Baroda zonal head

R. P. Marathe, General Manager, Bank of Baroda, took charge as the zonal head of Karnataka and Andhra Pradesh zone of the bank. Prior to this assignment, Marathe was the General Manager heading the strategic planning, data warehouse and MIS department of the bank at the corporate office, Mumbai.

Source: thehindubusinessline

Read more »

Axis Bank unveils co-branded credit card

Axis Bank on Tuesday launched a new co-branded credit card targeting affluent customers.

The card holders can get a discount of 20 basis points on home loans from the bank with a 50 per cent concession on processing charges.

Further, the card holders will be provided with reward points which can be redeemed with Miles & More’s partners across sectors such as flights, hotels, resorts, car rentals and retail stores among others. Miles & More is a Europe-based international frequent flyer program.

The card is available in two variants —World Select and World — with a joining fee of Rs 10,000 and Rs 3,500 respectively. The annual fee on World Select and World cards is Rs 4,500 and Rs 3,500, respectively.

It combines insurance and travel benefits for international frequent flyers and gets them access to Lufthansa and other member airlines’ programs.

In 2008 the credit card industry was at its peak. However, the slowdown that followed led to de-growth.

Card spends

“Over the past 12 months, customer interest and usage of credit cards has increased with overall card spends in the industry going up by over 30 per cent last year,” said Jairam Sridharan, Head Consumer Lending and Payments, Axis Bank.

Currently, the loan outstanding on Axis Bank’s credit cards is about Rs 1,200 crore, accounting for about 2 per cent of its retail book.

The bank has about 1.1 million credit card customers, while the total outstanding cards in the banking industry stood at 19.5 million as on April 2013.

beena.parmar@thehindu.co.in

Source: thehindubusinessline

Read more »

Oriental Bank cuts domestic term deposit rates

Oriental Bank of Commerce (OBC) has reduced the interest rates on certain domestic term deposits.

Interest rates have been cut by 25 basis points on domestic term deposits (including NRO deposits) under various maturities for 270 days and above of term deposits of less than Rs 1 crore.

For deposits of less than Rs 1 crore, the deposit rate on maturity period of 270 days to less than 1 year has been reduced from 8.5 per cent to 8.25 per cent.

For deposits with maturity period of one year to less than two years, the deposit rate has been lowered to 8.75 per cent from 9 per cent earlier.

There has been a 25 basis points cut in interest rates in other buckets — two years to less than three years, three years to less than five years, and five years to ten years as well.

The revised rates have come into effect from monday. This move is being seen as a precursor to review the bank’s base rate, which stood at 10.25 per cent.

With interest rates in the system softening, there may be increased pressure on public sector lenders to further reduce their lending rates. Already, there is some criticism that banks have not reduced their lending rates commensurate to the reduction in policy rates by the RBI.

Despite the latest reduction in deposit rates, OBC will aim for a higher net interest margin of 2.9 per cent this fiscal, V. Kannan, Executive Director, OBC said.

OBC had closed last fiscal with a net interest margin of 2.82 per cent.

srivats.kr@thehidu.co.in

Source: thehindubusinessline

Read more »

YES Bank gets court nod to advance board meeting to June 27

The Bombay High Court on monday directed YES Bank to advance its board meeting to June 27 to consider the appointment of its late founder’s daughter Shagun Kapur Gogia as the director on the bank’s Board.

Earlier, the mid-sized private sector bank was to hold the board meeting on July 24. The next hearing by the High Court on the appointment of the directors will be on July 1.

Gogia is the daughter of Ashok Kapur, who had co-founded YES Bank with his brother-in-law Rana Kapoor in 2004. Ashok Kapur passed away in the 26/11 terror attacks following which his stake in the bank was transferred to his wife Madhu Kapur.

Lawyers of Madhu Kapur and her daughter Gogia told the court that the voting for the election of three board of directors – Diwan Arun Nanda of advertising firm Rediffusion, banker Ravish Chopra and nuclear scientist M.R. Srinivasan, was not in consultation with them as per shareholders’ rights.

YES Bank on monday announced that Diwan Arun Nanda, Ravish Chopra and M.R. Srinivasan were elected as directors at the bank’s ninth annual general meeting held on Saturday. A poll was conducted and the general body of shareholders passed the resolutions relating to their appointment with a majority of 80 per cent in their favour.

The judge said "The bank must advance its board meeting to June 27 and consider the recommendation of appointing Gogia on the Board...without aggravating the situation."

The confirmation of the three directors now remains delayed till June 27.

The YES Bank stock ended down 2.57 per cent at Rs 490.15 on the Bombay Stock Exchange.

To raise Rs 500 m

Meanwhile, the bank plans to raise $500 million during this year through a combination of instruments aimed largely at institutional investors. In a press release, YES Bank said that the shareholders gave their nod to the fund-raising proposal at the bank’s AGM held on June 8.

According to YES Bank MD and CEO, Rana Kapoor, the bank would raise this amount “potentially through GDRs (global depositary receipts) in combination with a QIP (qualified institutional placement) and domestic institutional investors (DIIs) in order to ensure fullest and widest participation of all investor classes’’.

According to the BSE data, the promoters hold 25.72 per cent stake in the equity of the bank, while FIIs hold 48.95 per cent as at the end of March 31, 2013. DIIs hold 13.23 per cent equity and others hold 12.10 per cent.

Source: thehindubusinessline

Read more »

Cobrapost expose: RBI fines 3 private banks for violating KYC norms

The Reserve Bank of India on Monday penalised top three private sector banks — ICICI Bank, HDFC Bank and Axis Bank — for violating, among others, know-your-customer (KYC) norms and failing to file cash-transaction reports in some cases. It levied a penalty of Rs 1 crore, Rs 4.5 crore and Rs 5 crore on ICICI Bank, HDFC Bank and Axis Bank, respectively.

The central bank, however, said its investigation of these banks did not reveal any prima facie evidence of money laundering. It observed that any conclusive inference in this regard can be drawn only by an end-to-end investigation of the transactions by tax and enforcement agencies.

The RBI scrutinised books of accounts, internal control, compliance systems and processes of the banks’ corporate offices and some branches during March-April 2013. This was to investigate the allegations of violation of several RBI regulations, Foreign Exchange Management Act guidelines, and so on, made by online magazine Cobrapost.com in a sting operation.

Based on the findings of the scrutiny, the Reserve Bank issued a show-cause notice to each of these banks, in response to which they submitted written replies. A similar scrutiny was also conducted at the corporate offices of 36 other banks during April and May 2013. The process of follow-up action in respect of these banks is at different stages of completion, the RBI said.

The scrutiny of the three banks revealed violations such as non-adherence to certain aspects of KYC norms and AML (anti-money laundering) guidelines.

It also found non-adherence of KYC for walk-in customers, including for sale of third-party products, omission in filing of cash transaction reports in respect of some cash transactions, sale of gold coins for cash beyond Rs 50,000.

The other violations found by the RBI include not obtaining PAN (permanent account number) card details from customers, non-verification of source of funds credited to a few non-resident ordinary accounts, and non-observance of certain safeguards in respect of arrangement of “at par” payment of cheques drawn by cooperative banks.

beena.parmar@thehindu.co.in

Source: thehindubusinessline

Read more »