Rupee declines 30 paise
Mumbai: The rupee declined over 30 paise against the dollar following the fall in the domestic stock market.

The Indian currency opened at 44.33/35 and touched an intra-day low of 44.70/71. It closed the day at 44.63/64, against Friday's close at 44.29/30.

The rupee is likely to move in the broad range of 44.60-45.00, said dealers.

There was a fall in forward premia with the six-month closing at 2.82 per cent (3.03) and the 12-month ending at 2.81 (2.94).

Bonds: Bond prices fell by 10 paise. Total traded volumes on the order matching system were Rs 1,740 crore (Rs 1,780 crore).

G-secs: The 7.37 per cent - 7 year-2014 paper opened at Rs96.30 (8.06 per cent YTM) and closed at Rs96.54 (8.01 per cent YTM), against Friday's Rs96.67 (7.99 per cent YTM).

The 8.07 per cent-10 year-2017 benchmark paper opened at Rs100.50 (7.99 per cent YTM) and closed at Rs100.83 (7.94 per cent YTM), against Friday's Rs100.89 (7.93 per cent YTM).

Call rates: Call rates eased to 5-5.25 per cent (6-6.1 per cent). Traders said deals were also done at 4.5 per cent. In the first one-day reverse repo auction, the RBI received 24 bids for Rs12,585 crore but accepted only 24 bids for Rs1,995 crore (against the limit of Rs2,000 crore).

In the second one-day reverse repo auction, it received 20 bids for Rs 10,090 crore but accepted only 20 bids for Rs1,005 crore (limit Rs 1,000 crore).

CBLO: There were no repo bids. The CBLO market saw 403 trades aggregating Rs24,784.05 crore in the 3-6.05 per cent range.
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City Union Bank gears up for second round of funding
Chennai: City Union Bank is gearing up for another round of funding of about Rs400 crore in the second half of next year. The funding would be to meet the long term targets the bank has set for itself, rather than to meet any regulatory requirement.

The bank aims to reach a total business of Rs25,000 crore by 2010-11 (Rs7,500 crore now), comprising Rs15,000 crore of deposits and Rs10,000 crore of advances.

It wants its net worth to reach Rs1,000 crore by that year (Rs320 crore, now) and see its market capitalisation go up to Rs2,500 crore (about Rs350 crore).

Half the amount of Rs400 crore would be raised through private placements.

City Union Bank's capital adequacy ratio stood at 12.69 per cent as of December. About two-thirds of its Rs3,000-crore advances portfolio consists of loans under Rs3 crore, which come under the head `retail loans'.

Because the capital charge on retails loans is lower under Basel-II, City Union Bank's capital adequacy ratio will increase by about 1.5 percentage points when Basel-II starts.
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Canara Bank to raise $100 million via bonds in March
New Delhi: Canara Bank plans to raise $100 million through hybrid instruments during this month through its Hong Kong branch. The process is expected to be completed before the end of this fiscal.

The capital adequacy ratio (CAR) of the bank currently stands at 12.4 per cent and the bank expects to maintain this in the future.

Canara Bank has also announced setting up an insurance joint venture with the Oriental Bank of Commerce (OBC) and HSBC Insurance in which Canara Bank will have a majority stake of 51 per cent.

Canara Bank would control the proposed insurance joint venture with 51 per cent stake, while OBC would hold 23 per cent stake and HSBC the remaining 26 per cent - the maximum permissible limit for foreign partners under the present regulatory system.

The new life insurance company will have a paid up capital of Rs325 crore of which HSBC will contribute Rs170 crore, which includes premium for accessing the vast branch network of public sector banks.
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