Rupee weakens - bonds in range
Mumbai: The rupee ended at 43.78 against the greenback on Monday, lower than the previous close of 43.75/7550.

Forwards market: The six-month premium closed at 1.73/75 per cent (1.52) and the 12-month premium closed at 1.44/46 per cent (1. 37).

G-Secs: Bonds rose by around 20 paise but remained largely range-bound, with the 7.38 per cent 10 year benchmark paper closing at Rs105.42 (6.65 per cent YTM) on Monday as against Thursday's close of Rs105.20/25 (6.67 per cent YTM).

Call rates: Inter bank rates closed at 4.75 per cent.

CBLO market: 177 trades aggregating Rs6,033.10 crore was put through in the rate range of 0.20 to 5.20 per cent.
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Centre scheduled to borrow Rs.83,000 crore in H1
Mumbai: As per Reserve Bank of India's issuance calendar the Central Government is scheduled to borrow Rs83,000 crore from the domestic debt market through issuances of marketable dated securities in the first half of the fiscal 2005-06. The Centre had borrowed Rs59,000 crore in the first half of the fiscal 2004-05.

The securities being issued range from a maturity of five years to above 20 years.

All the auctions covered by the calendar will have the facility of non-competitive bidding scheme under which five per cent of the notified amount will be reserved for specified retail investors, said an RBI press release. Variable rate bonds will account for about 20 per cent of the total issuance, depending upon market requirement.

The calendar is subject to variations depending on market conditions and other relevant factors. As in the past, the RBI will also have flexibility to vary issuance of Government securities keeping in view the emerging requirements of the Government.
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RBI: Credit Policy statement on April 28
Mumbai: The Reserve Bank of India will unveil its annual policy statement for 2005-06 on April 28.

Bankers expect the policy to be benign on the interest rate front but said that some new products for risk management may be permitted.

Senior banking officials feel that there could be introduction of certain new products like credit derivatives and commodity futures as risk management tools since most of the financial markets are volatile at the moment.

Bankers are also hopeful of a reduction in the cash reserve ratio to be maintained by them with the central bank. Last year, the RBI had hiked the CRR by 0.5 per cent to 5 per cent as a measure to check the excess liquidity in the system.

The Union Budget 2005-06 had suggested the removal of the lower and upper ceilings to the SLR and to remove the limits of CRR to facilitate more flexible conduct of monetary policy.

Bond dealers also expect the central bank to come out with measures that will come as a `healing touch' in the wake of hardening bond yields.
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RBI: Rs.7,770 crore issuance under MSS
Mumbai: The Government is scheduled to issue a net of Rs7,770 crore through treasury bills under the Market Stabilisation Scheme, for the first half of the fiscal 2005-06, as against an issuance of Rs35,500 crore in the first half of 2004-05.

An RBI press release said that the issuance of Treasury Bills under the MSS would be undertaken by increasing the notified amounts for the regular auctions of 91-day, 182-day and 364-day Treasury Bills. The issuances under MSS covered by the above quarterly indicative schedule will be undertaken in addition to the regular issuances of Treasury Bills and dated securities.

The issuance of 91-day in this quarter will essentially be the roll over of 91-day Treasury Bills issued in the January-March 2005 quarter. The rollover of 364-day Treasury Bills issued would also start from April 15, 2005.

However, on account of shortfall in the absorption in 364-day Treasury Bills auction conducted under MSS on June 23, 2004, the net proposed issuance of 364-day Treasury Bills will be around Rs770 crore (face value).

Further, the absorption through newly introduced in the 182-day Treasury Bills is proposed to be Rs7,000 crore (face value), the release said.

The indicative schedule is subject to variations depending on market conditions and other relevant factors. In addition to the proposed issuances indicated in the schedule, the RBI will also have the flexibility for additional issuances of Treasury Bills and dated securities depending upon the prevailing liquidity conditions and other relevant factors.
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LIC to launch joint venture in Saudi arabia
Dubai: The Life Insurance Corporation of India, its foreign arm LIC International and the New India Assurance will join hands for setting up a joint venture company in Saudi Arabia.

The JV will offer life and non-life insurance products to NRIs and other residents. The initial share capital is likely to be around SR 100 million, LIC officials said.

The Indian government had sanctioned Rs280 crore till March 2005 for the insurance giant to fund its international activities.
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Allahabad Bank-PNB Kazakh JV to take-off in two months
New Delhi: The Kazakhstan joint venture subsidiary between Allahabad Bank and Punjab National Bank (PNB) is expected to take off within the next two months. Allahabad Bank officials said that the RBI has already granted its approval for the subsidiary, while requisite clearance from Kazakhstan is being awaited.

While PNB would hold 60 per cent in the subsidiary the remaining 40 per cent would be held by Allahabad Bank. Officials also said that the bank was planning to convert its subsidiary Allbank Finance into a merchant banking arm.

According to the officials though the RBI had asked Allahabad Bank to liquidate the NBFC arm, the bank wants to convert it to a merchant banker.
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ECGC signs MoU with Commerce Ministry
Mumbai: The Export Credit Guarantee Corporation of India Ltd (ECGC) has signed a memorandum of understanding (MoU) with the Ministry of Commerce and Industry for the year 2005-06, committing itself to conduct business operations as per the level expected by the Ministry.

As per the MoU, the twenty four performance indicators cover areas such as finance, productivity, ISO certification of 15 branches of ECGC, service delivery issues like claim settlements and buyer-wise approvals.

ECGC is also expected to develop risk-rating models and make efforts towards the global benchmarking of its activities during the financial year 2005-06.
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Laser Soft tool for United Bank
Chennai: United Bank of India has opted for Laser Soft Infosystems Ltd's tool, the "e-Circular," which facilitates instant delivery of circulars, application formats and loan agreements from head office (in electronic form) to all branches and offices, which are connected.

In a press release the company said that it has implemented the product for 3,300 branches of the State Bank India and for all networked branches of Corporation Bank. The product is being implemented in seven associate banks of the State Bank group. With e-Circular, banks can save up to Rs 1 crore annually for every 500 branches.
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