Clinton wants labour, environment in trade talks
Davos: US president Bill Clinton, addressing the World Economic Forum, raked up the issue of including the controversial labour and environmental standards in the new round of trade negotiations, which saw the collapse of the Seattle round of the World Trade Organisation conference in late 1999. He, however, advocated the need for a political consensus to facilitate an early start of a new round of trade negotiations.

Present at the Davos meet is a strong Indian delegation, including the chief ministers of Andhra Pradesh and Karnataka, and members of the Confederation of Indian Industry.

The meeting faced demonstrations by anti-free trade protestors, who broke police lines to disrupt the conference, smashed windows of shops, cars, and a restaurant. The demonstrators carried placards naming the conference as a "meeting of murderers".

GDP grows 6.8% in 1998-99
New Delhi: The Central Statistical Organisation has revised the growth in gross domestic product to 6.8 per cent against an earlier estimated 5.8 per cent for 1998-99. At 1993-94 prices, the GDP at factor cost is now estimated at Rs 9,49,525 crore in 1998-99 against Rs 8,89,102 crore in 1997-98.

The estimates reveal that this upward revision is due to a sharp recovery in the agriculture and services sectors. The statistics also showed that there is a deceleration in the manufacturing sector. The upward revision is said to have been made on account of the implementation of the Fifth Pay Commission’s recommendations, which substantially increased the salary levels of government employees.

SBI plans two lending schemes
Mumbai: The State Bank of India is all set to launch two lending schemes – mortgage lending and metal lending – for retail customers. Under the mortgage lending scheme, the bank will lend funds against the customer’s existing properties such as houses. These loans may have a repayment period of five years at interest rates linked to the bank’s prime lending rate.

Under the metal lending scheme, SBI will lend gold to jewellers and the repayment will be in the form of gold. The details of this scheme are being worked out, and the bank will seek permission from the Reserve Bank of India. The scheme will have an interest component, which will be payable in cash. The SBI has secured deposits of gold for on which it is paying interest at around three to four per cent.

Uco Bank officers seek premature retirement
Calcutta: Nearly 600 officers of Uco Bank, identified as a "weak bank" by the Verma Committee, are understood to have opted for premature retirement. It is reported that most of these officers are in the 52-58 age group and fear they may not a good deal under the bank’s voluntary retirement scheme. They are also not certain that officers will be eligible for the scheme. Hence they prefer premature retirement, with whatever benefits they know it offers.

Uco Bank has 32,000 employees, of which 8,000 are in the officer category.

Metlife picks up stake in First Leasing’s AMC
New Delhi: Metropolitan Life Insurance Company of the US, or Metlife, is picking up a 34 per cent holding in First Asia Asset Management, an asset management company promoted by First Leasing Company of India. First Leasing Company of India has another foreign partner, the Guinness group.

Metlife is investing Rs 3 crore in the asset management company, which will issue it equity through share transfers and a rights issue. Metlife is one of the big insurance players wanting to enter India.

SBI may have record profit this year
Mumbai: State Bank of India chairman G.G. Vaidya expects that the bank will record its highest ever profit from operations in 1999-2000. He estimates that the net profit will be around Rs 1,500 to Rs 1,600 crore. Mr Vaidya admitted that the bank’s performance in certain areas, like foreign exchange, has not been satisfactory, but it has covered up with better performance in other areas like international operations.

Exim Bank proposes dilution of govt stake
Calcutta: The Export Import Bank of India has proposed to the government that it should divest over 50 per cent of the public sector bank's equity. This would give the bank greater freedom in its operations.

The bank’s managing director Y.B. Desai says this plan is still at the conceptual stage, but the disinvestment is not far off. He told a seminar that the government has stopped funding the bank for the last three years, and the bank now raises funds from the market. He said a number of export credit banks abroad are privately owned.

Bank of Scotland hikes offer
London: The Bank of Scotland has improved its offer for National Westminster Bank in its fight for control of the British bank. The offer, which replaces an earlier special dividend with a special stock unit offer, is worth 24.3 billion or 14.56 per share. The rival offer by Royal Bank of Scotland is around 22 billion. Both the banks have time up to 31 January to increase their offers.

SBT to have own exchange house in Gulf
Thiruvananthapuram: State Bank of India subsidiary State Bank of Travancore is planning to set up its first directly-managed exchange house in Muscat, Oman, in the Gulf. The bank has identified Global Exchange Company in Muscat as its potential business partner.The bank is also considering setting up a second exchange of its own,  in Dubai, by firming up its arrangements with City Exchange, which handles the bank's work in Dubai.

The bank’s branches receive some 1.3 lakh drafts from the Gulf region every month. It had conducted a trial run of an electronic transfer system to enable customers to withdraw money just a day after it is remitted from a Gulf country. At present, the bank has arrangements with three Gulf-based exchange houses in Abu-Dhabi, Qatar, and Oman.

NatWest may  be forced for merger
London: National Westminster Bank will be forced to decide to be taken over by one of its bidders -- Bank of Scotland or Royal Bank of Scotland -- even if there is no clear winner in the present takeover battle, according to newspapers in London. Reports said if a split vote allowed NatWest to remain independent, the bank will be under pressure to recommend one of the bids. If the majority of shareholders voted in favour of a change, the bank’s board could find itself under pressure to recommend one of the bidders, the reports said.

A split vote -- where 40 per cent of NatWest’s shareholders vote for either of the bidders and 20 per cent for neither -- would allow the bank to escape the Scottish banks’ clutches. But the vote would also show that 80 per cent of the bank’s shareholders had voted for a change of management. The UK takeover code could allow a recommendation of an offer even after the end of the 60-day bid timetable. Normally if a bid is unsuccessful after 60 days, it lapses and the predator is not permitted to re-bid for 12 months. If NatWest decides to recommend one of the bidders after the end of 60 days, the takeover code would allow the rival bidder to make a fresh bid.

The bank has reiterated its rejection of the two bids, saying it is an excellent business with outstanding prospects.

Strong Indian team at Davos
New Delhi: India will have a strong presence at the annual meeting of the World Economic Forum at Davos, Switzerland, from 27 January to 1 February. The Indian speakers at the Forum will include finance minister Yashwant Sinha, chief minister of Andhra Pradesh Chandrababu Naidu, chief minister of Karnataka, S.M. Krishna and president of CII, Rahul Bajaj. A number of industry leaders and economists are part of the Indian delegation to the  Forum meeting.

Stanchart, BNP launch co-branded card
Mumbai: Standard Chartered Bank and Banque Nationale de Paris are launching a co-branded card – the Standard Chartered BNP Card. The card is meant for private banking customers of BNP. It will carry the logo of Stanchart and BNP and offer all benefits of a global Stanchart gold card.

Govt may publish name of bank defaulters
Calcutta: The government is working out a mechanism to publish names of top bank loan defaulters, according to minister of state for finance Balasaheb Vikhe Patil. He said the figures will be published by the Reserve Bank of India. At present basic facts of outstandings of over Rs one crore are available on the RBI website. Since there are legal snags in revealing the names of borrowers or the amount involved in non-performing accounts, the government is considering legislative and other changes to eliminate these obstacles, Mr Patil said.

VRS for banking sector coming
New Delhi: The government is understood to have finalised a voluntary retirement scheme for the banking sector. The scheme offers 45 days salary for every year of service or salary for the balance period of service, whichever is lower. At present, there is no VRS permitted for the banking sector. The scheme is targeted at the workforce in the 48-58 age group, while it is less attractive to employees in the 35-45 age group, according to sources in the government. The scheme is also understood to incorporate a compulsory retainment scheme, which empowers bank managements to offer VRS at its discretion.

Higher commission for insurance agents
Mumbai: The Insurance Regulatory  and Development Authority of India will permit insurance companies to pay higher agency commission of up to 15 per cent in the non-life sector. It is also proposing combined agency licences to agents, whereby an agent can sell products of one non-life and one life insurance companies. The authority’s chairman N.I. Rangachary says the authority has decided to do away with the different slabs in the commission and fix a maximum limit of 15 per cent.

Rupee under pressure
Mumbai: The rupee plunged to a 16-month low of 43.66 against the dollar on 24 January. The main reason, money market players say, was frantic dollar buying in the earlier part of the day by the State Bank of India on behalf of its clients. The bank later turned seller along with Bank of Baroda and Bank of India, which helped the rupee to stabilise a little. The selling process is said to have been initiated at the instance of the Reserve Bank of India. The rupee closed at 43.6050/6150.

RBI prescribes norms for take-out finance
Mumbai: The Reserve Bank of India has announced norms to be followed by banks and financial institutions while taking recourse to take-out finance. In the case of unconditional takeover, a risk weight of 20 per cent is applicable to the lending institution where the full credit risk is assumed by the taking over institution. In case partial credit risk is assumed by the taking over institution, the risk weight will be 20 per cent on the amount taken over and 100 per cent on the amount not to be taken over. For the taking over institution, the risk weight will be 100 per cent on the amount taken over. The credit conversion factor will be 100 per cent. In the case of conditional takeover, both the lending and taking over institutions will have to assign a risk weight of 100 per cent. The credit conversion factor for the taking over institution will be 50 per cent.

The central bank feels the norms are necessary as banks and financial institutions are adopting the new product of take-out finance for meeting the financial requirements of infrastructure projects.

365-day banking by Grindlays
Mumbai: ANZ Grindlays Bank will introduce 365-day banking in six of its branches located in Delhi, Mumbai and Chennai. The bank has already introduced extended banking hours, phone banking and doorstep banking as part of its efforts to enhance the value of the "banking experience".

Anuroop "Tony" Singh, country head, ANZ Grindlays Bank, India, says these facilities and services form an integral part of the bank’s overall business plan to offer all customers a range of banking services and products for satisfying their personal financial service needs.

Federal Bank plans Internet-based services
Bangalore: The private sector Federal Bank is entering Internet banking and e-commerce in a big way. The new services will be available to the bank’s customers by April 2000 and will cover metro and large cities initially, says the bank’s chairman K.P. Padmakumar. The bank is tying up with Infosys Technologies to introduce these new services. It will be using Infosys Technologies’ BankAway software for the new services, which will mainly be targeted at its non-resident Indian account holders.

NatWest consolidates its defences against takeover
London: National Westminster Bank of Britain has reported profits of 2.305 billion in 1999, which is above its expectations and this is forming one of its defences against the two hostile takeover bids by Bank of Scotland and Royal Bank of Scotland that is currently on. The bank’s share price also went up by 3.6 per cent to 1223 pence. The bank has  announced a share buyback scheme through a tender for 1.5 billion worth of shares and announced that it will return further 2 billion worth of capital to its shareholders later this year.

Government not to dilute holdings in LIC, GIC
Mumbai: The government is not going to dilute its holdings in the General Insurance Corporation of India and the Life Insurance Corporation of India, says Union minister of state for finance Balasaheb Vikhe Patil. And it will continue to have a say in their policy decisions, he says.

Mr Patil told a seminar on challenges faced by the insurance industry that the emergence of new players in the insurance sector will require a change in the work culture in the industry. The state-owned corporations, however, have no need for worry about a level playing field as the guidelines for private insurance companies will have social objectives compliance similar to those applicable to the public sector insurance companies.

Corporation Bank’s plan for insurance unit
Mumbai: The Corporation Bank is interested in picking up the entire 74 per cent holding in its proposed insurance subsidiary despite the Reserve Bank of India's stipulation that Indian banks wanting to set up insurance subsidiaries can have holdings up to a maximum of 30 per cent. Corporation Bank is approaching the RBI with this proposal, says R.S. Hugar, chairman of the bank.

The government has approved foreign partners taking a maximum of 26 per cent holding in insurance ventures and Indian companies picking up the balance.

Inflation crosses 3% mark
New Delhi: The inflation rate rose to 3.1 per cent in the week ended 8 January 2000. The rate had hovered below the three per cent level for about two weeks.

The increase has been attributed mainly to increases in the prices of various food and non-food items during the period under review. Official sources said there has been a rise in the indices of primary articles and manufactured products. The inflation rate was 4.52 per cent in the corresponding week in 1999.