Put loan collaterals through periodic legal audit, RBI tells banks

To contain fraud, the Reserve Bank of India on Friday asked banks to subject the title deeds and other documents in respect of all credit exposures of Rs 5 crore and above to periodic legal audit. They should also re-verify the title deeds with relevant authorities as part of regular audit exercise till the loan stands fully repaid.

Bankers say such a directive may have been prompted by rising bad loans and the necessity to ensure that collateral are sufficient to make recoveries.

The central bank said banks should furnish a review note to their board/audit committee of the board at quarterly intervals on an ongoing basis.

The review note should contain information in respect of legal audits covering aspects such as the number of loan accounts due for legal audit for the quarter, how many accounts covered, list of deficiencies observed by the auditors, and steps taken to rectify the deficiencies.

The note should also mention the number of accounts in which the rectification could not take place, course of action to safeguard the interest of bank in such cases, action taken on issues pending from earlier quarters.

ramkumar.k@thehindu.co.in

Source: thehindubusinessline

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4 killed in fire at IndusInd Bank office in Mumbai

Four IndusInd Bank employees lost their lives in a late night fire at the Andheri back-office of the bank. The fire broke out at around 11.15 p.m. on Thursday.

The deceased have been identified as Atanu Laha, 35, Rakesh Shirkar, 24, Rohan Katkare, 25, and Sandeep Naik, 25. Eight others were injured.

Since it was the central processing unit of the bank, there were employees working late into night.

According to fire department officials, the fire took place because of a short-circuit.

“A fire broke out at Induslnd back office in Andheri (East) at 11.15 p.m. Four Induslnd Bank employees lost their lives and a few have been injured,” IndusInd Bank said in a statement to the BSE.

The injured are being treated at the Seven Hills Hospital in the city. Three of them are being treated for injuries at the Intensive Care Unit and believed to be stable.

“Thirty-five people were brought to the hospital on Thursday night. Four of them were brought dead. Eight are being treated for different injuries and trauma and the rest 22 were discharged yesterday after preliminary examination,” Shweta Tyagi, a doctor at the Seven Hills Hospital, said.

satyanarayan.iyer@thehindu.co.in

Source: thehindubusinessline

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Vijaya Bank FCNR rates

Vijaya Bank has revised interest rates on FCNR (B) deposits with effect from June 1. The revised interest rates are as follows: For one year to less than two years period – £2.88 per cent, $2.69 per cent, €2.39 per cent, AU$5.34 per cent, CAD 3.79 per cent.

For two years to less than three years period - £2.68 per cent, $2.45 per cent, €2.43 per cent, AU$4.74 per cent, CAD 3.43 per cent. For three years to less than four years period - £3.78 per cent, $3.64 per cent, €3.57 per cent, AU$5.93 per cent, CAD 4.55 per cent. For four years to less than five years - £3.96 per cent, $3.90 per cent, €3.74 per cent, AU$6.16 per cent, CAD 4.70 per cent.

For five year period only - £4.15 per cent, $4.16 per cent, €3.93 per cent, AU$6.32 per cent, CAD 4.85 per cent.

Source: thehindubusinessline

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OBC opens new branch in Chennai

Oriental Bank of Commerce has launched a new branch in Chennai, taking the total number of its branches in the country to 2013. With this new chapter, the number of branches in the region (Tamil Nadu and Puducherry) goes up to 51. According to a press release, the bank intends to open another 10 branches in this region during the current financial year. 

It has over 1,500 ATMs across cities. Total business of the bank in 2012-13 crossed Rs 3-lakh crore, and the operating profit of the bank for the year was at Rs 3,691 crore. Net profit stood at Rs 1,328 crore. The bank hopes to more than double its business in the next five years.

Source: thehindubusinessline

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Associate banks merger can start by September: SBI chief

State Bank of India (SBI) today said the proposed merger of its five associate banks with itself could start by September after a high-powered committee submits its report on the same.

The high-powered committee headed by SBI Managing Director, S Vishwanathan would furnish its report by July-August, and later based on the report the merger process could start by September, SBI Chairman Pratip Choudhuri said here.

State Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala, and State Bank of Travancore would be the target associate banks for merger, Chaudhuri said.

Out of five associate banks, three are listed, and two are in the direct ownership of SBI, he said, adding “we would take non-discriminatory way to decide and choose merger of any of the five associate banks. It would be a long process that would take employees’ confidence and participation”.

SBI’s capital was not so strong earlier, but with the March’s balance sheet the capital became very strong and for merger there should be a cash of Rs 1,000-3000 crore, he said.

SBI did first ever amalgamation of its associate State Bank of Saurashtra in 2008 followed by State Bank of Indore in August 2010.

Source: thehindubusinessline

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