24 December 2004

Rupee stronger; gilt prices up
Mumbai: The domestic currency ended at 43.7650/7750 against the dollar, seven paise above the previous close of 43.83/85.

Forwards Market: The six-month forward premium closed at 1.61 per cent (1.94 per cent) while the one-year forward premium finished at 1.26 per cent (1.48 per cent).

G-Secs: The benchmark 7.38 per cent 2015 paper closed at Rs106.22; yield on the paper fell to 6.55 per cent. The 7.55 per cent 2010 paper finished at Rs105.40 with the yield at 6.35 per cent.

Call Rates: In a range of 4.5-6 per cent.

CBLO market: 156 trades aggregating Rs5,400 crore were transacted.

IndusInd Bank plans to hike capital by Rs.130-150 crore
Mumbai: Indusind Bank said it plans to increase its capital base by Rs130-150 crore either through a Tier II bond issue or an equity issue. Its equity capital was Rs290.42 crore as on September 30, 2004.

The bank plans to raise this additional capital in the initial months of the next calendar year to maintain its capital adequacy ratio above eleven per cent. Currently, its capital adequacy ratio stands at 13.17 per cent.

IndusInd also said that it would explore strategic partnerships with overseas banking entities mainly to gain access to new markets. The bank is looking at partnerships with several entities to provide services to its customers in wealth management, private banking and capital markets. The bank would look at expanding its presence overseas in the United Arab Emirates, the UK and South East Asia, not through representative offices or branches, but through a different business model, the bank has indicated. The bank currently has representative offices in Dubai and London.

IndusInd Bank is also planning to increase the number of its branches to 130 by the end of the financial year 2004-05, by converting erstwhile Ashok Leyland Finance offices into its branches.

23 December 2004

Rupee closes weaker - G-Secs up
Mumbai: The rupee ended marginally weaker on Wednesday at 43.83/85 per dollar against its previous close at 43.80/81 per dollar.

Forwards Market: Range bound with the six-month forward ending lower at 1.94 per cent (2.07 per cent), while the one-year forward finished at 1.48 per cent (1.51 per cent).

G-Secs: The benchmark 7.38 per cent 2015 paper ended at Rs105.75 at a yield of 6.62 per cent. The 7.55 per cent 2010 paper closed at Rs105.15, with yield at 6.41 per cent.

T-bills auction: At the Rs2,000 crore 91-day treasury bill auction, the cut off yield was set higher at 5.49 per cent (5.4 per cent), while at the Rs1,000 crore 364 day t-bill auction it was set at 5.74 per cent - 9 basis points over the previous cut-off of 5.65 per cent.

Call Rates: In the inter-bank market rates were in a range of 5.75 to 6.1 per cent.

CBLO Market: 130 trades aggregating Rs5,600 crore were transacted.

Card-to-card fund transfer facility from IDBI Bank
Mumbai: The IDBI Bank has announced the launch of 'card to card money transfer', a domestic remittance product, in collaboration with Visa International. Customers can now transfer money from their bank account or a Visa card to any other Visa debit or credit card across the country through this scheme.

The facility will be available free of cost for three months, but a flat charge of about Rs15 per transaction will be levied eventually. At present, the daily limit for transfer of funds is Rs25,000 on card-to-card payment. The transaction may take 24 to 36 hours for completion, the bank has said.

22 December 2004

Rupee strengthens further - gilts move up
Mumbai: The rupee strengthened for the second consecutive session on Tuesday to end at 43.80/81 against the dollar, finishing 14 paise stronger than its previous close at 43.94/95 to the dollar.

Forwards Market: The six month annualised premium closed at 2.07 per cent (2.25 per cent) and the one year annualised premium at 1.51 per cent (1.65 per cent).

G Secs: The benchmark 7.38 per cent 2015 paper ended at Rs105.30 at a yield of 6.68 per cent while the 7.55 per cent 2010 paper ended at Rs105.12 at a yield of 6.41 per cent.

Call Rates: In a tight range of 5.90 to 6.00 per cent.

CBLO market: 141 trades worth Rs5,500 crore were transacted.

New Securities Bill tabled in Lok Sabha
New Delhi: The Finance Minister, P. Chidambaram, has introduced the Government Securities Bill, 2004 in the Lok Sabha. The Bill aims to make trading in Government securities more customer-friendly by doing away with the various `rigidities and deficiencies' in the Public Debt Act, 1944.

Among other things, the new Bill - which also seeks to repeal the Indian Securities Act, 1920 - enables creation of pledge, hypothecation or lien in respect of Government securities, which means allowing individuals to these as collateral for borrowing purposes.

The Bill allows banks, which maintain a subsidiary general ledger (SGL) account with the Reserve Bank of India, to operate a constituent SGL on behalf of an individual.

While the bank would be deemed to be the holder of such an account, the constituent would, however, be a beneficial owner, who "shall be entitled to claim from the holder all the benefits and be subjected to all the liabilities in respect of Government securities held in the Constituent SGL account."

IDBI: NPAs transferred to Stressed Assets Fund
Chennai: IDBI will avoid Rs750 crore of provisioning consequent to the transfer of Rs9,000-odd crore of non-performing assets (NPAs) to the Stressed Assets Stabilisation Fund, the IDBI Chairman and Managing Director, M. Damodaran, has revealed.

Under the proposed scheme, Rs9,000-crore of NPAs will go off the books of IDBI, into the Stressed Assets Stabilisation Fund. IDBI will get in return, 20-year, non-interest bearing bonds worth the amount. The bonds will be redeemed as and when the bad loans are recovered.

He has also indicated that the swap ratio of the merger of IDBI and IDBI Bank would be decided next month. Since it is a merger of two banks (now that IDBI has become a deemed bank), there is no need to go to the High Courts for approvals, Damodaran noted.

PNB awaiting nod for second public offer
New Delhi: Having completed all formalities for its second public offer, the Punjab National Bank is awaiting the Government's nod to hit the capital market. The PNB intends to sell five crore shares through its second public offer.

The bank expects advances to grow by 23.4 per cent to Rs58,000 crore this fiscal from Rs47,000 crore last fiscal. Deposits are likely to grow by 16 per cent to Rs1,00,000 crore this fiscal from Rs86,000 crore in 2003-04.

IndusInd launches 'young savers' scheme
Mumbai: IndusInd Bank launched `IndusInd Young Saver' a savings scheme for children on December 19. Children can open a savings account with the bank with a minimum opening balance of Rs11 under this savings scheme, said a press release.

The scheme has plans for education loan at concessional rates for professional courses children could pursue in future.

21 December 2004

Rupee firms up - bonds in a narrow range
Mumbai: The rupee finished a shade stronger at 43.94/95 against the dollar on Monday from its close of 43.96/97 on Friday.

Forwards Market: The six-month forward ended at 2.25 per cent (2.11 per cent) and the one-year forward finished at 1.65 per cent (1.48 per cent).

G-Secs: The 7.38 per cent 2015 paper ended at Rs104.95 at a yield of 6.73 per cent while the 7.55 per cent 2010 paper finished at Rs104.85 at a yield of 6.48 per cent.

Call Rates: In a tight range, moving between 6.00 and 6.10 per cent.

CBLO Market: 132 trades amounting to about Rs4,500 crore were transacted.

UTI Bank board to review splitting of CMD post
Mumbai: The UTI Bank has decided to hold a board meeting to reconsider its decision to split the post of Chairman and Managing Director into non-executive Chairman and Managing Director.

According to sources, it is expected that Dr P.J. Nayak, Chairman and Managing Director, UTI Bank, whose five-year term is ending by December 31, will be offered the option of continuing as Chairman and Managing Director.

On December 15, the board had offered the position of Managing Director to Dr Nayak, which he reportedly turned down.

Finance Ministry backs up Damodaran
New Delhi: The Ministry of Finance has defended the IDBI Chairman, M. Damodaran's move to relinquish charge as Administrator of Specified Undertaking of UTI (SUUTI or UTI-I) and as Chairman of UTI Mutual Fund, and hinted that the move was not linked to the recent developments at UTI Bank.

In a statement, the Ministry said that Damodaran's decision to step down from posts in SUUTI and UTI MF was only to facilitate appointments in the two entities.

"Since October 1, 2004 the Government has considered the matter of appointing a Chairman for UTI MF and an Administrator for SUUTI. In order to facilitate these appointments, Mr Damodaran has relinquished the charge of UTI-MF and SUUTI," the release said.

While former LIC Chairman, S.B. Mathur, has been appointed Administrator of SUUTI, the Ministry has said that the Chairman of UTI MF would be appointed shortly by its sponsors in consultation with the Government.

"The Government appreciates the excellent work done by Damodaran in dividing the former UTI into UTI-MF and SUUTI and turning around the fortunes of UTI-MF," the release said.

The Ministry also said that Damodaran must pool in all his energies to guide IDBI. As CMD of IDBI, Damodaran was holding additional charge of UTI-MF and SUUTI.

"(IDBI Bank) is a bank in which Government of India holds, directly, 58.5 per cent shares and, through other public sector enterprises, a further 11.3 per cent. IDBI requires the full-time and undivided attention of its CMD, Mr Damodaran," the Ministry said.

20 December 2004

Prudential Coop. bank liquidator assures early settlement
Hyderabad: The official liquidator appointed by the Reserve Bank of India for the Prudential Cooperative Urban Bank has said that the latter's branches would be open from Monday to facilitate access to lockers and assured that apex bank has promised to settle claims at the earliest.

V. Amarender Rao, Joint Registrar, who has been appointed as the liquidator, in a statement said that within three months all bank accounts will be audited and early settlement of claims made, the RBI has assured.

Rao also appealed to the cooperative bank depositors not to panic and cooperate with the liquidator and staff to ensure an early claim while also facilitating recovery of the amounts from borrowers. He also urged the bank staff to ensure quick settlement of claims to depositors having more than Rs. one lakh.