15 november 2003

banks see positive impact from new ecb norms
mumbai: credit offtake in banks, in terms of rupee borrowings, will receive a substantial boost as a result of the government's tightening the screws on external commercial borrowings, according to bankers.

pnb gilts seeks rbi nod for portfolio management
new delhi: pnb gilts ltd, the primary dealer subsidiary of punjab national bank, has approached the reserve bank of india for permission to offer portfolio management services to clients.

moratorium on gujarat bank
mumbai: on the recommendation of the reserve bank of india, the government of india has passed the order of moratorium on the south gujarat local area bank ltd, navsari, gujarat.
the moratorium will remain in force from the close of business on november 13 to february 12, 2004.

pnb housing cuts rate to 7.75 per cent on all home loans
new delhi: pnb housing finance, as part of a festival offer, has reduced interest to a flat rate of 7.75 per cent for all loans of up to 20 years. the loans would be extended on a monthly reducing balance.

rupee down 4 paise; gilts subdued
mumbai: the rupee closed four paise weaker at rs 45.42 against the dollar on friday against thursday's close at rs 45.38 in a volatile forex market.
dealers said that after opening at rs 45.37, the domestic currency slipped on consistent buying of greenbacks by state-run banks.

insurance plan for undergraduate nris in december
new delhi: the government has finalised a scheme to provide mandatory insurance cover to undergraduate indian workers going abroad on term contracts. according to available estimates, there are close to 12 lakh undergraduate indian workers employed abroad who will be the direct beneficiaries of this insurance cover.

nabard reduces refinance rates
mumbai: national bank for agriculture and rural development has reduced the rate of interest on refinance by 100 to 125 basis points and also reduced loan slabs for refinance from four to three. the revised rates are applicable from november 12, 2003

14 november 2003

karur vysya to market ecgc risk products
coimbatore: export credit guarantee corporation (ecgc) has signed a mou with tamil nadu-based karur vysya bank ltd, to enable the former to route marketing of its export credit/risk insurance products through the latter under the concept of `bancassurance'. karur vysya is the fourth bank to enter into the tie-up with ecgc, after corporation bank, south indian bank and federal bank. the mou was signed on thursday by s. prabhakaran, executive director of ecgc, and p.t. kuppuswamy, chairman of kvb, at the bank's headquarters in karur, according to an ecgc communication issued here.

the agreement would enable kvb offering the ecgc's export insurance covers to the exporting community serviced by the bank's various branches across the country. ecgc is offering six different export insurance risk covers including the three new additions - buyer-wise policy, turnover policy and maturity factoring - for the exporters. according to ecgc corporate office sources, the corporation is also likely to sign a similar agreement with bank of rajasthan ltd next week.

icici bank's move flayed
kochi: the united forum of bank unions has expressed serious concern on the reported move of icici bank to transfer the equities of federal bank and south indian bank, saying that it was against the interest of the state.

a meeting of the unions held here has requested the icici bank to desist from the move and to maintain status quo in the operations of these banks. v.k. prasad, convenor of the united forum, said the unions would strongly oppose any move aimed at transferring the shares to any outside parties.

exemption for rlf rupee funds to be phased out
mumbai: the reserve bank of india has decided to phase out the exemption for rupee funds raised under the reciprocal line facility (rlf) from the prudential limits specified for call, notice money transactions. it would be phased out from the fortnight beginning february 7. accordingly, lending or borrowing in call and notice money market including transactions under the facility from the fortnight beginning february 7 should not exceed the prudential limits specified for this purpose, the rbi said in a circular to all commercial banks on thursday.

under the rlf , a foreign bank in india enters into a standing agreement with an indian bank having branches abroad to draw specified amount of rupee resources from the latter in india against the equivalent amount of foreign currency sanctioned to the indian bank by the former abroad. last year, in a bid to provide greater flexibility in liquidity management by banks, the rbi had exempted the rupee resources drawn under the rlf from the prudential limits specified for the call and notice market transactions. the position was to be reviewed in a year.

sbi, uti bank to share atms
mumbai: state bank of india (sbi) and uti bank have signed a memorandum of understanding (mou) for mutual sharing of atms. this arrangement is aimed at offering the customers of both banks the facility of using the combined network of atms, both existing and proposed, of the two banks across india.

this will include the atms of the seven associate member banks of sbi, a release said.uti bank has a network of 210 branches and extension counters and 1,040 atms, spread across 92 cities and towns, covering 23 states and two union territories

om kotak life targets 186% growth in fpi this fiscal
kolkata: om kotak mahindra life insurance co ltd, has set an ambitious target to achieve an impressive growth of 186 per cent in its first premium income (fpi) during the current financial year, according to the om kotak life managing director shivaji dam.
"our total first premium income as of the last financial year of 2002-03 was rs 35 crore and we have set a target to improve the figure to rs 100 crore by the end of the current fiscal," he told reporters here late on wednesday evening. he also said that the company management also expects to achieve a growth of around 400 per cent in the sum assured amount by the end of the current financial year. "the total sum assured at the end of the first six months of the current financial year was rs 1,400 crore and we expect the figure to increase to around rs 5,000 crore by the end of the current fiscal," he said.

claiming that om kotak life has been maintaining a sustained growth since its inception two years back, dam said that from the first premium income figure of rs 7 crore at the end of the first year of the commencement of operation, the company was able to increase the figure to rs 35 crore at the end of the second year. he said that the current penetration level of om kotak life, which is the fourth largest insurance company in india, stands at 0.5 per cent. "we are confident of improving our penetration level to 25 per cent during the next couple of years," dam said.

he also said that om kotak life is operating through 21 branches in 21 cities at present. "by the end of the current fiscal, we will operate from 19 more cities by opening up 19 additional branches," dam said. he claimed that the management is also planning to increase its number of agents to 10,000 by the end of the current financial year, from the existing 5,500

rabo, maharashtra may team up for life sciences, entertainment
mumbai: rabobank has offered to actively associate with the maharashtra government for the development of a world class life sciences park, agri-business park and media and entertainment park in mumbai and around. in its recent presentation to the state's principal industries secretary vishwas dhumal, the bank has proposed to involve in the development of the project concept, techno economic viability of each individual project, project management and financial advisory. dhumal confirmed that such a presentation took place and told that the state government would consider rabobank's proposal, especially on the development of the life sciences park in and around mumbai and the world class agri-business park on the very prestigious mumbai-pune express way.

according to the bank, mumbai is the ideal location for all three projects, for, being the financial capital, having good quality infrastructure and its pre-eminent position as an investment destination, has been acknowledged by private investors. the bank has pointed out that around 2,400 hectare of salt pan land would be available to the state government. this land situated largely in north-east mumbai can directly be used for development or slums can be relocated to the salt pan land and then land released from that could be used for development of these projects. rabo india has called upon the state government to set up a working group for the development of these three projects comprising government representatives and specialists from individual sectors and professionals from the bank. it has also suggested for the formation of a steering committee with powers to take decisions on behalf of government for speedy project development by the working group.

the objective of life sciences or biotechnology parks can become a one stop source for providing research and support services, finding partners for collaboration research, structuring financial and contractual management of projects, providing product development capability on a commercial basis and helping with patent and licensing development. the life sciences park can focus on enzymes, biological and stem cell research, cro and clinical trials services to pharma industry. it can also house the specialised downstream facilities. on the development of the agri-business park, the bank has suggested that it would function throughout the year except for a brief period when it would be closed for maintenance, cumulatively for four weeks in a year. the park will have sector pavilions with permanent stalls of government organisations, leading companies, cooperatives, trade associations across sectors showcasing their product offerings. it could be developed at the cost of rs 60 crore.

sbi to recast top brass - associates, arms to come under md
mumbai: the subsidiaries and associates of state bank of india will soon be brought under the charge of a managing director. according to informed sources, the deputy managing director (dmd) of sbi, who heads the associates and subsidiaries business of the bank, chandan bhattacharya, might soon be elevated to the position of the second managing director of the country's largest bank, as part of a restructuring plan for the bank's top brass. significantly, with this promotion, the corporate banking group may no longer have an md at its helm, as the sbi act has provision only for one chairman and two managing directors. the move, if implemented, will be a departure from the bank's tradition of having two managing directors, one heading the corporate banking group and the other the national banking group. sources said, bhattacharya, the senior-most dmd in the bank, took over the associates and subsidiaries portfolio last month, perhaps as a precursor to his impending promotion.

in fact, the position of managing director of the corporate banking group has been lying vacant, ever since the retirement of a.k.batra, fuelling speculation about who will be his successor.
last year, p.n. venkatachalam and batra were appointed as the managing directors of sbi and venkatachalam continues to be the managing director of the national banking group. venkatachalam is due to retire next year, when mr ashok kini, dmd, information technology, is tipped to step into his shoes. sources contend sbi's plan is motivated by the consistent performance of its associates and subsidiaries, which has in large part contributed to the parent's growth in the recent past. there is also an anomaly in the hierarchical structure of the bank, which will be corrected when the new plan is implemented. a source close to sbi confided, " the anomaly lies in the fact that the dmd of sbi's associates and subsidiaries group, has some other dmds reporting to him, i.e, among the managing directors of the associates and subsidiaries, some are technically dmds in the parent bank. therefore, there is a need to promote the dmd in charge of associates and subsidiaries in sbi to a higher position". in 1994-95, the international consulting group mckinsey worked out a restructuring programme for sbi. at that time, in keeping with the firm's recommendations, the bank split up in different business units headed by the chairman and two managing directors..

more recently, the consultant was awarded the project of the major business process re-engineering plans of sbiaccording to sources, the consultant found that the corporate banking group, which was set up in the early nineties to expedite large value credit delivery to corporates, has not kept pace with the initial projections, while the associates and subsidiaries have exceeded expectations in terms of performance. sources said, " the corporate banking group has helped the bank in achieving certain milestones. however, in the last three years, interest rates have gone down and corporates are raising funds from the market. even corporates with large funds at their disposal have not been expanding". according to bankers, the corporate banking group operations has stabilized over the years and does not necessarily need an managing director to lead it, and once the economy picks up, so will the business. if sbi's new managing director heads associates and subsidiaries, it is also indicative of the chairman, a.k. purwar's focus on `group synergies', sources said.

13 november 2003

allahabad bank to recruit 119 specialist officers
kolkata: kolkata-based public sector commercial bank, allahabad bank, has decided to recruit 119 specialist officers for its different departments. the recruitment will be done in junior management grade scale i and middle management grade scale ii. allahabad bank general manager in charge of personnel & administration pankaj mishra said that the recruitment process will not be handled by the bank itself but by an outside agency called institute of banking personnel selection (ibps). "we have informed ibps about our requirement in the individual category and the institute will now conduct the recruitment procedure on our behalf," he said. it is learnt that out of the 119 specialist officers, 30 will be for the post of manager (information technology), which will fall under middle management grade scale ii. allahabad bank will also recruit 15 managers (law) which also come under middle management grade scale ii. the other recruitments under middle management grade scale ii will be 10 posts of financial analysts and 15 posts of manager (marketing).
the bank will also recruit 24 official language officers (hindi officers) which come under the junior management grade scale i. the bank has also asked for the recruitment of 10 security officers and 15 information technology officers. both these recruitments will be made under the junior management grade scale i. mishra said that in case of recruitment of security officers, persons with defence or police background will be given preferences. however, he refused to comment on the educational qualifications required for other posts. he also said that the pay scale for these specialist officers will be same as applicable for all public sector commercial banks in the country. these specialist officers will be not be offered anything additional in the form of perquisites.

indian bank home loan fair
coimbatore: a one-day trade and home loan fair has been proposed at the tiruchi road branch of the indian bank on november 15, where spot sanction would be accorded to eligible loan applicants. the bank offers trade loan at 11.5 per cent and home loan at 7.5 per cent. the bank will also take over regular loan accounts from other banks on that day. for the convenience of its customers, the bank has extended its business hours up to 7 pm in six of its city branches. standard chartered, singapore co launch $100-m india fund mumbai: indian companies, especially mid-sized ones, never had it so good when it came to equity funding. several private financiers are eyeing the mid-cap sector, currently witnessing a spectacular run on the exchanges. the latest entrant is merlion india fund, a $100-million private equity fund equally owned and managed by standard chartered private equity, an investment arm of the uk-based standard chartered bank and temasek holdings (private) ltd, the investment holding arm of the government of singapore. according to industry sources, the fund, which would invest in mid-sized companies, was set up some time in late august, had a low-key launch here on monday. when contacted, company officials declined to comment.

managed out of singapore, the merlion india fund, would focus on mid to late stage companies in most growth sectors with the exception of infrastructure, real estate and trading. the directors of the fund are s. iswaran, managing director, strategic development of temasek holdings; and karam butalia, global head of stanchart private equity. in a press release issued on august 26 in singapore, the fund had said that it would provide growth capital for indian companies that aim to expand their business within india and beyond, as also invest in regional companies seeking to participate in opportunities in india to build their business. butalia was recently quoted by a news agency as saying that the fund would normally pump in between $5 million and $30 million for equity stakes, but the "sweet spot" for investment was between $10 and $20 million. temasek holdings holds large stakes in leading companies in singapore and the listed companies in its group portfolio represent more than 20 per cent of the market capitalisation of the singapore exchange.

gtb mulling rights issue
mumbai: in an effort to improve its capital adequacy ratio, which currently stands at near zero levels, global trust bank is mulling a rights issue. this comes even as the troubled private sector bank has been scouting for a foreign investor for several months now. "the special committee of three directors constituted to finalise the capital raising process has approved the proposal and the matter is to be presented before the board of directors of the bank shortly. pricewaterhousecoopers ltd, auditors of the bank, is to prepare the prospectus to be filed with the securities and exchange board of india, sources said. the size of the rights issue, however, is yet to be worked out. the bank's share price closed at rs 20 on wednesday on the bombay stock exchange with turnover in terms of value at rs 21.85 lakh.

according to sources, the promoter, ramesh gelli, is seen to be interested in upping his stake in the bank and is likely to subscribe to the rights issue. he currently holds 20.28 per cent stake in the bank. however, the international finance corporation, washington, which has been associated with the bank since its inception as a stakeholder, in august, reduced its stake to 7.77 per cent from 10.38 per cent. the bank needs about rs 300 crore to restore its capital adequacy ratio to acceptable levels, but the rights issue is not likely to be so large at a time when almost the entire capital has been wiped out in provisions and write-offs. the tier i and tier ii capital are now at zero, according to the bank's audited balance sheet for the year ended march 31, 2003. the bank had made provisions and write-offs of rs 309.14 crore in view of the negative impact on its exposure to capital market and other sensitive segments in the earlier years and suffered a net loss of rs 272.7 crore for the fiscal ended march 31, 2003..

during the last fiscal, the bank had recorded a marginal growth in deposits at rs 6,921 crore (rs 6,443 crore) and suffered a decline in advances at rs 3,276 crore (rs 3,435 crore). earlier, the restructuring plan had been to find an investor and then go in for a rights issue, but the reversal in the order of events suggests a possible delay in finding a foreign investor. lazard india ltd and jm morgan stanley pvt. ltd are the financial advisors for the capital restructuring process and a special committee comprising three directors was constituted for finalisation of the terms of investment. the us-based newbridge capital and the hong kong-based aif in association with warburg pincus have reportedly shown interest in acquiring stake in gtb, but officials refused to confirm the same.

12 november 2003

adb, 23 housing finance firm get to use securitisation act
new delhi: the centre has sparked off fresh action under the securitisation act by allowing the asian development bank (adb) and housing finance companies (hfcs) to exercise powers provided under the legislation.in separate notifications issued on monday, the ministry of finance said that the adb and 23 hfcs would be allowed to tackle their loan defaulters under the securitisation and reconstruction of financial assets and enforcement of security interest act (safraesi), commonly referred to as the securitisation act.

the move to broaden the ambit of legislation comes even as a petition challenging the very legality of the act is pending before the supreme court involving mardia chemicals and icici bank. it has been argued before the apex court that the law is heavily biased in favour of lenders.the securitisation act provides enormous powers to lenders to take possession and subsequently dispose of assets of chronic defaulters without the need of going through the cumbersome and time-consuming legal process under the civil laws."adb can now act under the law to deal with defaulters of its loans as any other bank or financial institution can do," a senior official of the finance ministry said while confirming the issuance of the notifications.

on the housing finance front, the government has stipulated that only those hfcs which are registered with the national housing bank (nhb) and having a minimum tier-i capital of rs 10 crore would be eligible for exercising the powers under the act. the eligibility norm allows only 23 of the larger hfcs to be included under the act.nhb officials said that though the net non-performing assets (npas) on housing loans would be in the region of 2-3 per cent of outstanding loans,the new powers accorded to the hfcs would further the bolster lending for housing purposes by the entities."till now we were able to take possession of property only through the court process by obtaining the necessary decree. now we would be able to act outside the court process. this would act as a further deterrent and allow lenders to provide loans more freely for housing purposes," a senior nhb official said.this is the second time that new entities have been allowed under the act after cooperative banks being allowed to exercise the powers.

sbt plans atm at sabarimala
thiruvananthapuram: the state bank of travancore (sbt) will set up two special `pilgrim banking centres' and an atm in the environs of the sabarimala temple, says a press release from the bank.dr n. babu, the president of the travancore devaswom board, will inaugurate the bank's atm at pamba on november 16, the release adds. this atm will be linked to the bank's network and also to the countrywide network of the state bank group, the release states.

the `pilgrim banking centres' will offer several facilities to pilgrims including the encashment of demand drafts issued either by the sbt or other banks of the state bank group, issue of demand drafts on all branches of banks in the state bank group, phone, fax and e-mail facilities and so on, the release adds. these centres will also offer pilgrims facilities for the safe custody of their money, says the release.

state bank slashes small loan rates
mumbai: taking a cue from the mid term credit policy of the reserve bank of india (rbi) announced last week, the largest commercial bank, state bank of india (sbi) has reduced interest rates by 0.25 to one per cent for small scale industries (ssi), small businesses and agriculture. the rate for short-term loans between rs 25,000 to rs 50,000 up to one year for ssi and small businesses has been cut by one per cent to 8.75 per cent. the new rates are effective retrospectively from november 1. loans between rs two to rs five lakh will be charged 10.5 per cent, down by 0.75 per cent.

however, the interest for the slab between rs 50,000 to rs two lakh remained unchanged at 9.75 per cent, it said. similar benefit has been extended for loans above one year as well. sbi said the rates for agriculture sector loans has been reduced by 0.25 per cent for term loans between rs 50,000 to rs two lakh at 10 per cent while the cut is 0.5 per cent at 10.5 per cent for those between rs two to rs five lakh.

stanchart offers special home loan rate
mumbai: standard chartered bank (stanchart) on tuesday announced special rates for home loans across all tenures up to 20 years. the offer, valid from november 12 to november 30, 2003 will offer floating rate loan at 7.49 per cent and fixed loan at 7.75 per cent per annum.the home loan customers can also avail a bundle of insurance products such as home contents insurance, health insurance and personal accident insurance, said a press release.

"we are delighted to offer this special rate bundled with unique insurance benefits. apart from competitive pricing and special offers we ensure speedy processing of the loan application, ease in documentation and flexible terms," the bank's general manager & head (home loans, car loans and banking strategy), mn murali said. the offer is available in mumbai, delhi, chennai, kolkata, pune, bangalore, hyderabad, surat, baroda, coimbatore, jaipur and lucknow.

unions agree to iba proposal for 100% computerisation
kolkata: the indian banks' association (iba) has achieved a major breakthrough in its eighth bipartite wage negotiation with the unions which have unconditionally agreed to iba's proposal for 100 per cent computerisation in all public sector commercial banks in the country.with the industry-wise agreement put in place, individual psu banks will now go for similar bank-wise agreements with their respective unions. the country's biggest public sector commercial banks, state bank of india (sbi) has already entered into a 100 per cent computerisation agreement with its staff and officers associations. the united forum of bank unions (ufbu) convenor, ashok kumar dutta, told that there is no point in opposing the iba proposal for 100 per cent computerisation."as trade unions, our duty is to ensure that salaries, wages and other benefits of bank employees are protected and we can ensure that only if our banks perform well financially. the proposal for 100 per cent computerisation is aimed at improving customer service and thus attract more customers. so, there is no reason for us to oppose that, dutta said.

ufbu is an umbrella organisation of nine officers' and staff unions operating in the banking industry. dutta further pointed out that despite the agreement in the earlier ie, seventh bipartite wage negotiation that the psu banks will not allow more than 70 per cent computerisation, there is not a single psu bank that has not surpassed the limit. state bank of patiala and indian overseas banks have already achieved 100 per cent computerisation. "some other banks that have already achieved over 90 per cent computerisation include andhra bank at 99 per cent, bank of india at 92 per cent, bank of maharashtra at 91 per cent, corporation bank and oriental bank of commerce at 93 per cent each and state bank of hyderabad at 91 per cent,"dutta said.

according to him, 14 banks, namely, bank of baroda, canara bank, central bank of india, dena bank, punjab & sind bank, punjab national bank, state bank of bikaner & jaipur, sbi, state bank of indore, state bank of mysore,state bank of saurashtra, state bank of travancore, syndicate bank and union bank of india, have already achieved over 80 per cent computerisation. "even the three erstwhile weak banks - indian bank, uco bank and united bank of india - have achieved computerisation at the rates of 78 per cent, 75 per cent and 74 per cent respectively," dutta said. he said that that of the fourteen circles of sbi, already five have achieved 100 per cent computerisation.dutta pointed out that when it is quite evident that banks are determined to go in for computerisation on a large scale considering its advantages,there is no point in resisting the move. "however, we will resist the iba proposal for transfer of clerks beyond their linguistic zones," he said. the next meeting of the eighth bipartite wage negotiation is scheduled for tomorrow.

11 november 2003

icici bank cuts home loans by 25-50 bps
mumbai: amidst intense competition, icici bank has reduced its floating interest rate for home loans by 25 to 50 basis points (bps) effective from monday to become the cheapest financier in the segment. the bank's home loan offering is cheaper by almost 25 bps to its closest competitors like the state bank of india (sbi) and hdfc in all housing finance tenure.

the bank has offered an uniform rate of 7.5 per cent for all tenors till november 26, as a special festival offer. the revised rates for loans up to five years will be 7.5 per cent (earlier 7.75 per cent) while that for 6-20 years will be 7.75 per cent. in the case of 6-20 years, two brackets of 6-10 (eight per cent) and 11-20 years (8.25 per cent) have been merged.

it has also announced a 0.5 per cent reduction in its home prime lending rate. this will ensure that existing floating rate customers can also benefit from this scheme.

"with the ongoing reduction in our cost of funds and the continuing soft interest rates in the system, we are pleased to offer a corresponding benefit to both our existing and new customers," executive director chanda kocchar said.

on the special festival offer, he said customers availing of the balance transfer scheme during this period (till november 26) would also benefit from zero fees for home loans transferred to the bank from their existing bank/housing finance company.
hdfc, last month, unveiled a diwali bonzana scheme by offering home loans at 7.75 per cent for up to 20 years under floating basis from october 27 to november 5, which was extended till november 8. sbi had reduced interest rates of housing loans with effect from october beginning. sbi's floating rate up to 5 years is pegged at 7.75 per cent, above 5 years and up to 15 years at 8.25 per cent. the bank's rate above 15 years and up to 20 years is 8.50 per cent. sbi's fixed rate of interest up to 5 years is fixed at 8.00 and above 5 years and up to 15 years it is 8.5 per cent. for above 15 years and up to 20 years it is 8.75 per cent.

tayals open to increasing stake in bor to 49%
kolkata: tayals, the principal stakeholders in bank of rajasthan (bor), are open to increasing their stake in the bank from 43 per cent now to 49 per cent, according to bor chairman pk tayal.
"we are open to the idea of increasing our stake in bank of rajasthan up to the reserve bank of india's permissible limit of 49 per cent. however, we are not sure by when we will be able to do that. i wish to increase the stake to 49 per cent just now. but we will have to do that according to the cash flow," he said at a press conference here on monday.

tayal said that as on march 31, 2003, bor's total deposit base was rs 6,000 crore and total advance at rs 2,300 crore. "we plan to increase the deposit base to rs 12,000 crore and advances to rs 6,000 crore by 2006," he said, adding that bor's net non-performing assets (npa) as a percentage of total advances were at eight per cent as on march 31, 2003. "we are confident of bringing down the net npa figure to two per cent within the next couple of years," he said.

he said that bor had recovered around rs 250 crore of npas during the past four years as against a write-off of rs 100 crore during the same period. "the accumulation of fresh npas during the past four years has almost been negligible," tayal said, adding, the bank's capital adequacy ratio has been comfortable at 15 per cent as on march 31, 2003, as against the rbi-stipulated norm of nine per cent. he said that bor had issued 100 notices under the newly promulgated securitisation act, involving a total default amount of rs 100 crore.

central bank of india mulls major branch consolidation
mumbai: the state-owned central bank of india (central bank) is going in for rationalisation of its branch network in a big way. "the bank will go for branch consolidation by merging branches in the areas, where business growth has reached almost a saturation point and opening new branches or converting existing extension counters and satellite offices into full-fledged branches in areas where business and commercial activities are picking up,' a senior bank official said.

the bank is not planning any further expansion of its branch-network as it entails large investment. the emerging business environment, with a focus on technology and speed of service delivery mechanism like internet and atms, has also left little scope for branch expansion by the bank, already having a large network.

the bank recently merged four of its branches, converted five extension counters and one satellite office into full-fledged branches and converted three branches into satellite offices. 'we are planning further consolidation of our branch network in the states of maharashtra, uttar pradesh, madhya pradesh, bihar, west bengal and gujarat,"the source said.

the bank merged three branches in mumbai and one in ahmedabad. the branches, which were merged in mumbai are jhaveri bazar, khand bazar and null bazar. in ahmedabad, the manik chowk branch was merged with gandhi road branch.
the bank is, however, considering a proposal to open overseas banking units (obu) in special economic zones (sezs) in the country. as on march 31, 2003, the bank has a total of 3,117 branches-1,419 in rural areas, 743 in semi-urban areas, 539 in urban areas and 416 in metropolitan areas.

andhra bank revises nre rates
hyderabad: andhra bank has revised interest rates on term deposits under non-resident external rupee accounts (nre accounts) with effect from monday. the revised interest rates are 1.7 per cent (existing 1.55 per cent) for deposits of one year to less than two years, 2.4 per cent (2.05) for deposits of two years to less than three years and 3 per cent ( 2.65 per cent) for deposits of three years.

dewan housing gets $12.5-m ifc term loan
mumbai: dewan housing finance corporation ltd has obtained a term loan equivalent to $12.5 million from international finance corporation, a world bank arm.

this loan is for funding of the company's housing finance operations. the company's focus on the semi- urban and rural area as well as lower income segments also fits well with ifc's loan policies, said a news release from the company.

"dhfl is increasingly focused in the semi urban and rural parts of the country and expects to see greater volumes in these areas," said wadhawan. "we are also expanding aggressively by opening service centres in the smaller towns, which is the fastest growing segment for housing finance."

earlier this year, dhfl acquired an 85.91 per cent equity stake in vysya bank housing finance ltd. dhfl has 42 branches in over 151 convenience centres across the country.

10 november 2003

kerala sets panel to revise bank salaries
thiruvananthapuram: the state government has ordered the setting up of a nine-member committee with a mandate to revise pay scales of urban cooperative bank employees. the secretary, department of cooperatives, will be the chairman of the committee while the registrar, cooperatives, will act as the convener, an official of the state government said here.

the committee has been asked to assess the monthly pay-and-benefits structure existing as on april 1 this year, and make recommendations on fixing different scales, reviewing existing scales and other related issues after taking into account the financial position of the concerned bank.

among the members of the committee are k.r. aravindakshan, president, state cooperative bank, president and secretaries of the cooperative urban federation, urban bank staff organisation, all-kerala cooperative urban bank employees association, kerala cooperative workers federation and cooperative employees union and m. p. jackson, president, the irinjalakkuda town cooperative bank.

the committee has been asked to submit its report within six months. the existing wage agreement in the urban banks sector in the state had expired on march 31.

dhanalakshmi bank counter upgraded in kochi
kochi: dhanalakshmi bank has upgraded the extension counter attached to the bar council of kerala, high court campus, kochi to a full fledged branch.

in his welcome speech, the executive director of the bank, k.a. menon said the bank had already taken steps to implement core-banking solutions, which enables the customers to enjoy anywhere banking facility.

during his inaugural speech, k.b. mohandas, chairman of kerala bar council pointed out that dhanalakshmi bank is capable to serve the interest of the public, even as it strived to maintain its traditional values.

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