08 november 2003

custom house agents licensing rules to be amended
new delhi: custom house agents (cha) licensing rules are to be amended by the government to streamline operations to boost exports and imports, according to the minister of state for finance, shripad naik.

addressing the custom house agents association, naik said that the ministry was in the process of building up a consensus for bringing about necessary changes in the cha licensing regulations of 1984. ``my vision is to install a truly faceless, yet humane system, where offices of the exporters, importers, custom house agents and customs department are electronically linked, and exports and imports grow by leaps and bounds,'' he said. customs department had taken up a conmputerisation drive and launched a new module `icegate' for registering shipping bills online.

four pvt banks can accept indirect taxes
mumbai: in addition to direct tax collections and pension disbursements, another pie where new age private banks have been permitted to dip their hands into indirect taxes - excise and service tax collections.

traditionally an area exclusive to state-run banks, the presence of new private sector banks is expected to usher in competition and ensure "all round better service'', possibly denting the share of the market leader, state bank of india.

the four institution-backed banks — icici bank, hdfc bank, uti bank and idbi bank — will commence indirect tax collections in 13 commissionerates on a pilot basis from november 15.

this permission is exclusive to the four institution-backed new private banks, which were permitted to collect direct income-tax, disburse pensions and handle expenditure related functions of all central government ministries/departments from october 1. these four banks may soon be permitted to gather customs duties, but there are some technical issues to be sorted out with relation to the collection mechanism.

banks are also in negotiations with various state governments to collect sales tax. private banks are enthusiastic about governmental business and say "it's a matter of pride to be recognised by and to be associated with the government,'' said a senior hdfc bank official. on the commercial front is the commission paid at rs 1.18 per rs 1,000 of turnover, which is quite attractive. negotiations are under way for increasing the commission fees, but reserve bank of india seems to be of the opinion that the present fees are too high and is unlikely to raise the same, said a banker.

sbi drops deposit rates
mumbai: state bank of india has decided to lower its deposit rates by 25 to 50 basis points across maturities with effect from november 10. interest rates on domestic term deposits with a maturity of 15-45 days have been lowered by 25 basis points to 4 per cent, for 46-179 days 4.50 per cent (5.00 per cent), for 180 days to less than one year 4.75 per cent (5.25 per cent), for one year to less than two years 5 per cent (5.50 per cent), for two years to less than three years 5.75 per cent (5.25 per cent) and for three years and above 5.50 per cent (6 per cent). interest rates on deposits with a maturity of 7-14 days remain unchanged at 4 per cent.

deposit rates for senior citizens have also been revised downwards by 50 basis points. rates on deposits with a maturity of one year to less than two years is 5.50 per cent (6 per cent), for two years to less than three years 5.75 per cent (6.25 per cent), for three years and above 6 per cent (6.50 per cent).

indusind plans 20 more branches
visakhapatnam: indusind bank is planning to open 20 more branches during the current financial year and the half-yearly net profit of the bank has gone up to rs 100.87 crore from rs 42.86 crore during the corresponding period last year.

this was stated by the assistant vice-president of the bank, k.s. sastry, at a press meet at the gajuwaka branch near here on tuesday. he said it translated into an annualised eps of 9.16 on an equity base of rs 220 crore. the capital adequacy ratio of the bank stood at 17.55 per cent (15.75 per cent). he said the bank had opened 15 new branches of late and four additional extension counters, taking the total to 56 branches and 12 counters in the country. the bank had set up 32 off-site atms during the year, taking the total to 77.

monsoon bonanza for farmers from banks
bangalore: buoyed by a good monsoon, several state-run banks are stepping up their rural credit disbursement initiatives in karnataka. most of the new schemes are floated to trigger farm equipment financing while canara bank has signed a pact with nabard to co-finance the agriculture sector.

state bank of india has tied up with vst tractors and tillers to finance purchase of power tillers. the company would offer a discount of rs 15,000 to farmers who buy tillers under this scheme and the bank would offer an interest of 10 per cent on the amount financed. margin money to be brought by the farmer would be five per cent of the cost of the tiller. the repayment period is pegged at nine years with one-year grace. close to 200 branches of the 310 branches in karnataka offer agriculture financingof rs 820 crore.

recently, same deutz-fahr signed a pact with state bank of mysore, wherein the bank would finance 90 per cent of the invoice value of tractors to farmers at 10.5 per cent on reducing balance. it would also extend finance up to 90 per cent on tractor-operated implements such as trailer, cultivator, rotovator, front-end dozer and loaders. collateral security needed to finance tractor is minimum of four acre of irrigated land or six acre of dry land. as part of this scheme, same dealers would bear the insurance cost of the tractor.

canara bank's joint effort with nabard aims to finance rural projects with large outlays. under this arrangement, the institutions will jointly entertain loan proposals for term loans as well as working capital.

07 november 2003

apsfc signs tripartite pact with govt, sidbi
hyderabad: the andhra pradesh state financial corporation (apsfc) has announced here on thursday that it has entered into a tripartite memorandum of understanding (mou) with the small industries development bank of india (sidbi) and the state government, as a part of the restructuring exercise of the corporation. according to an apsfc press release here, the mou was signed by the sidbi chief general manager, g.a. nayak, the andhra pradesh industries and commerce principal secretary, k.v. rao, and the apsfc managing director, ratan p. watal.

the mou complements the ongoing internal restructuring measures initiated by the corporation during the last two years and would provide added impetus to the improved performance of the corporation, the release said. according to the corporation, the pact was a result of the relief package announced by the central government and sidbi, the unequivocal financial and other support extended by the ap government and the determined efforts of the corporation to bring about a turnaround and become competitive.

the central government had earlier (during august this year) unveiled a relief package for restructuring of state financial corporations (sfcs) in the country. the package offers 2 per cent per annum interest rate concession on all existing refinance loans and 2 per cent interest rebate for prompt repayment of all future refinance loans availed by sfcs from sidbi.

according to the apsfc managing director, watal, the state government has already agreed to allocate rs 6 crore towards equity of the corporation for the current fiscal and to consider equity allocations for future years also based on performance review. the government has also agreed to extend guarantees to the slr and non-slr bonds and other borrowings required for funding the loans sanctioned by the apsfc, he said. watal said the corporation has agreed to initiate certain internal restructuring measures and show performance improvement in the areas of recovery, cost reduction and containment of non-performing assets in respect of fresh sanctions.

the mou with sidbi comes into effect from april 1 this year and would be in operation for a period of five years or till the corporation was fully restructured/recapitalised, whichever was later, watal said. stating that the validity of the mou might be extended by mutual consultations, he said the performance of the corporation would be reviewed once a year or at such intervals sidbi and the state government might direct as.

call to hike non-interest income
mangalore: efforts should be made to increase non-interest income as the demand for credit was not picking up and interest rate war was fierce, the chairman and managing director of karnataka bank ltd, ananthakrishna, has said. participating in the regional review conference of the bank in mangalore on thursday, he said the need of the hour is to safeguard the interest of advances by constant monitoring. judicious selection of parties and activities will help minimise risk and contribute to bank's profit, he said, and added that the soundness of a bank is judged by its profit and the health of advances. stating that past and present performance of the bank is a pointer to the future, ananthakrishna urged the regional heads to play a crucial role.

lord krishna bank keen to get strategic investors
new delhi: lord krishna bank is looking at all options, including offering a stake to a foreign partner, to increase its capital base by rs 35 crore - rs 50 crore this fiscal. ashwani k. puri, promoter-director of the kochi-based bank, said, "the first choice would be to offer fresh equity to strategic investors. two or three major foreign banks have evinced interest. we are considering it." the bank plans to offer fresh equity to the foreign banks in return for technology and expertise.

other options include a rights issue or an initial public offer. currently, the puris of mohan exports and the burmans of dabur india hold about 65 per cent stake in the bank. "we are planning either a tier-ii bonds issue or a rights issue of about rs 35 crore - rs 50 crore this fiscal," the bank's managing director, r.m. nayak, said. the bank's capital adequacy ratio is at about 13 per cent now, but the bank may require fresh capital to sustain its business, which is slated to grow by 100 per cent to about rs 5,000 crore this fiscal. puri said the bank aimed at rs 20,000-crore business by march 2007.

the bank had also applied to the reserve bank of india for opening branches in afghanistan and planned foray into ghana, sudan and mozambique, he said. it planned to open 14 new branches and 20 extension counters across the country by may 2004. the bank also has a tie-up with visa to offer debit cards. to offer mutual fund products, it has tied up with lic mutual fund, sbi mutual, prudential icici and some others.

icici bank gets uk licence, opens arm in london
mumbai: icici bank ltd has gained a uk banking licence to set up its first subsidiary overseas, icici bank uk ltd. with its first branch abroad located at knightsbridge, london, icici bank uk is currently the only locally incorporated banking subsidiary among indian banks in the uk, said a press release from the bank.

the bank has also formed a partnership with uk-based lloyds tsb plc; thereby customers of icici bank can open and access their current and savings accounts through the 2,200 branches of the uk bank. non-resident indians and persons of indian origin customers can also transfer funds to icici bank accounts in india.

icici bank uk will initially be targeting three commercial business areas: commercial banking support for small and medium corporates in the uk, trade finance in support of trade flow between the uk and india, corporate finance and syndication.
as part of its international banking division, the bank inaugurated its overseas offshore branch in singapore and an obu in mumbai in addition to representative offices in shanghai, dubai and new york and has received approval for opening a wholly-owned subsidiary in canada.

06 november 2003