5 June 2004

RBI tightens PD dividend norms
Mumbai: The Reserve Bank of India (RBI) has laid down tough dividend declaration norms for PDs.

Foreign currency inflows slow down
Bangalore: Foreign currency inflows into the country have substantially come down as most investors have taken a pause and remittances from non-resident Indian depositors have slowed down.

Rupee firms up
Mumbai: The rupee closed 13 paise higher on Friday at 45.11/12 against the dollar up from Thursday's close of 45.24/25.

Can Fin Homes to step up lending
Mumbai: CAN Fin Homes Ltd has set a target of 40 per cent increase in sanctions and disbursements for the financial year 2004-05.

BoR gets Maharashtra licence for franking stamps
Mumbai: The Bank of Rajasthan Ltd has secured the licence for franking stamps through its various branches in the State. The licence has been received from the Inspector General of Registration & Controller of Stamps and Chief Controlling Revenue Authority, Government of Maharashtra.

4 June 2004

FM reassures PSU banks
Mumbai: Finance Minister P Chidambaram has told public sector banks to go ahead with plans to tap the capital market provided the government's stake does not fall below 51 per cent. He added that while banks would have full functional autonomy, they would be accountable. Chidambaram told bankers on Wednesday evening the pace of reforms would accelerate as the United Progressive Alliance government stabilises.

As the government will not extend capital support to public sector banks, they could raise resources from the market within the available headroom. Chidambaram emphasised that there was no directed lending to agriculture. The government will not meddle in pricing and the risk adjustment exercise of banks for agri-lending and that concern about sticky assets on this account was misplaced.

Rupee gains 14 paise
Mumbai: The rupee gained 14 paise in the currency market mainly due to central bank support and global weakening of the US dollar and ended the day at 45.24/25, levels up 14 paise from Wednesday's close of 45.38/39 in its value against the greenback.
The rupee opened the day at 45.35/37. While there was no demand from FIIs for the dollar, gold importers were purchasing dollars. Meanwhile, the BSE Sensex closed 105 points down from the previous close. State-run banks were seen selling dollars in the market perhaps on behalf of the central bank in the last one hour of trading, said dealers.

3 June 2004

Rural disbursement up
Patna: The National Bank for Agriculture and Rural Development (Nabard) notched up record-breaking figures in investment credit for agriculture and rural development in Bihar in 2003-04.

Refinance disbursement stood at Rs 96.70 crore during 2003-04, against the Rs 85-crore target set for rural investment credit. Refinance disbursement in the previous year (2002-03) was Rs 82.10 crore . Nabard sources said the 16 regional rural banks (RRBs) constituted a major share of the refinance amounting to Rs 90 crore, constituting 93 percent of the total disbursement marking a 16.85 percent growth from the disbursement of Rs 74.83 crore made to RRBs during 2002-03.

2 June 2004

Tribunal stays ICICI notice to Mardia
Mumbai: The Debt Recovery Tribunal, Ahmedabad, has stayed ICICI Bank's notice to Mardia Chemicals under the Securitisation Act. The ad-interim ex-parte injunction will be in force till July 1, when Mardia Chemicals' appeal next comes up for a hearing.

This comes after the Supreme Court judgment of April 8, which allowed lenders to approach the Debt Recovery Tribunal freely by striking down a provision of the Securitisation Act that required a borrower to deposit 75 per cent of the lender's claim before he could file an appeal with the DRT.

Following the Supreme Court order, Mardia Chemicals filed its appeal with the DRT on May 20. Apart from restraining ICICI Bank from acting under the July 2002 notice, Mardia Chemicals had also asked the DRT to direct ICICI Bank to preserve and protect the company's assets under its possession. The DRT has granted relief only on the first appeal.

Stanchart plans subsidiary
Mumbai: Standard Chartered Bank is planning to convert itself into a subsidiary of a foreign bank rather than retain its branch status due to the strong and growing competition from Indian banks. Earlier, Stanchart had ruled out exploring the possibility of taking the subsidiary route. Foreign banks have the option of converting their branches into wholly-owned subsidiaries which will enable them to freely set up branches at a time when private sector banks are expanding their reach to second and third-tier towns.

However according to RBI branch licensing norms, foreign banks are not allowed to set up too many branches but as a subsidiary, they will be able to expand their branch network like their counterparts in the private and public sector. The bank has not as yet applied to the RBI for a subsidiary licence, as it is waiting for the new government to settle down at the Centre, said Sanderson.

StanChart MF to launch new `fund of funds' scheme
Mumbai: Standard Chartered Mutual Fund is planning to launch a `fund of funds' scheme, to provide stable returns and make available an investment avenue for a longer horizon, according to the details filed in the offer document with SEBI. The fund offers three options - regular, institutional and super institutional. The super institutional plan is for non-individuals who would invest a minimum amount of Rs1crore in the fund.

The Fund of Funds scheme, available with dividend and growth options, does not carry any entry load. Exit load of 0.5 per cent will be charged for the regular plan where amount invested is less than Rs10 lakh and investment is redeemed within 6 months, stated the document. The investment objective of the fund is to optimise returns through investments in debt-oriented mutual funds and money market instruments.

Sundaram Mutual announces launch of Leadership Fund
Chennai: TVS group company Sundaram Mutual has announced launch of a new open ended equity fund - the Sundaram India Leadership fund (SILF). The seeks to achieve capital appreciation by investing in select stocks companies that meet the criteria of "leaders' in their respective sector and sub-sectors. Leaders would be identified as the top two or three companies in any sectors in terms of net revenue or total income.

1 June 2004

Vijaya Bank plans foray in UK, UAE, China
Bangalore: As part of its plans to foray into international markets Vijaya Bank is opening a branch in Hong Kong and representative offices in UK, UAE, China and three other Asian countries. In the future the Bangalore-based bank plans to open representative offices in Britain, United Arab Emirates, Oman, Singapore, Thailand and South Korea and an offshore banking unit in Mumbai's special economic zone.

Vijaya Bank has seen its forex earnings jump by over 50 percent in the last fiscal to Rs 7,270 crore last fiscal from Rs 4,909 crore in 2002-03 and export credit increase to Rs 852 crore last fiscal, compared to Rs 593 crore in 2002-03. Vijaya Bank's NRI deposits stood at over Rs 1,235 crore till March 2004, which accounts for almost 6.0 per cent of the total deposits.

Sundaram Finance net up at Rs 56 crore
Chennai: Sundaram Finance has announced a profit after tax of Rs 55.62 crore for 2003-04, higher by 22 per cent in relation to the previous year's profit of Rs 45.66 crore.The company's board had earlier recommended a dividend of 70 per cent on its equity shares that each have a face value of Rs 10.

Autosoft tool for banks
Pune: Pune-based Autosoft Systems Ltd has launched a low-cost high-end architecture structure providing centralised banking solution. According to an official release, the software incorporates control and checking measures, generates exception reports so that the supervisor could monitor immediately, audit trail, maintains edit history and built-in transaction tracking system

OSS reports compulsory for UCBs
Mumbai: THE Reserve Bank of India has decided to extend the offsite surveillance (OSS), a supervisory reporting system first introduced for the scheduled primary (urban) cooperative banks, to all non-scheduled UCBs having a deposit size of Rs 100 crore and above.

31 May 2004

RBI lays guidelines for DFIs
Mumbai: The working group of the Reserve Bank of India has made several recommendations on development finance institutions (DFIs). The group says DFIs that the Centre does not support must convert themselves into either a bank or a non-banking finance company. DFIs that convert into banks will not get relaxations unless mandated by a statute. State finance corporations should be phased out within a definite time frame.

Special status conferred upon securities issued by public financial institutions should be done away with. All new financial institutions should be set up as a company to be registered with the RBI as in the case of NBFCs. They will be called development finance companies (DFCs). A net owned fund of Rs 100 crore has been recommended for the formation of such DFCs. The report added that a cap in terms of NOF may be fixed for mobilisation of public deposits by residuary non banking firms.

Sahara Mutual on expansion drive
Mumbai: Sahara Mutual Funds has launched a major expansion drive and is targeting to recruit more than a hundred employees to man its couple of dozen new offices. The major expansion drive will see, besides addition of personnel, introduction of new schemes, including a few niche products and to begin with the company is launching a mid cap fund and a monthly income plan.

Sahara MFhas already concluded restructuring the board of its asset management company. The new faces on it include Mr Subroto Roy, promoter of Sahara India Parivar, and Mr Sanjiv Kapoor, an accounting professional. The Fund has also brought in a chief investment officer - Naresh Kumar Garg - who has been with UTI since 1989 and has handled a number of functions at the public sector fund house. From five centers at present the MF will now expand its reach by setting up offices in 24 new locations.

ICICI insurance cos to go public
Mumbai: The ICICI group is opening its two insurance companies, ICICI Lombard and ICICI Prudential to the market. The group is also brining in a private equity investor for its business process outsourcing (BPO) company, ICICI OneSource.

The general insurance company ICICI Lombard, a 74:26 venture with Lombard of Canada, may come into the market this year while the group's life insurance arm ICICI Prudendial will go public later.

According to the company ICICI Lombard has become profitable after a one full year of operation with a RoE (return on expenditure) of 20 per cent and can be taken to the market. while
ICICI Prudential, a 74:26 venture with Prudential of the UK, will take another three years to break even.