Rupee firms up - G-Secs tumble
Mumbai: The rupee closed stronger at 43.7250/7350 against the dollar on Thursday against its Wednesday closing on at 43.75/76.

Forward market: The twelve-month premium closed at 1.48 per cent (1.48 per cent) and the 6-month premia closed at 1.76/83 (1.77 per cent).

G-Secs: G-Secs crashed by 120 paise with chain selling by nationalised banks. The 10-year-7.38-per-cent 2015 benchmark paper closed at Rs102.90 (6.98 per cent YTM) against Wednesday's close of Rs104.1050(6.82 per cent YTM). The market also reacted to the news that the RBI may auction the 7.38 per cent 10-year 2015 bond. The 7-year 6.85 per cent 2012 year paper closed 50 per cent lower.

CBLO market: 177 trades aggregating Rs7,063.05 crore were made in the rate range of 4.52 to 4.75 per cent.

Call rates: The inter bank rates closed at 4.70/80 per cent.
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For HSBC India provides attractive returns
Chennai: The Hongkong and Shanghai Banking Corporation's has so far invested about $800 million in India operations and has announced its intention to put in another $240 million.

Niall S.K. Booker, Group General Manager and CEO, India, HSBC, told journalists here that the size of Indian operations was still small compared to the bank's global scale of business, but India was growing very fast. India operations fetch about 26 per cent return on capital - attractive enough to encourage further investments, he said. He said that the retail segment, in particular, was growing very fast.

He said that HSBC favoured starting a non-banking finance company (NBFC) for growth. Booker reiterated HSBC's stand that the investment in the UTI Bank was a financial investment and "we are making good money on it."

Whether or not the bank would be able to raise its stake in the UTI Bank further was a matter under discussion with the RBI, he said.
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Western Union to enter domestic money transfer market
Mumbai: Western Union Financial Services plans to enter the domestic money transfer market in India, and has approached the RBI and the FIPB for permission. At present, the company is dealing in international remittances to India.

If Western Union does get the permission, it will be the first private financial services company to start domestic money transfer operations in India. As of now, only the Indian Postal System and banks offer money transfer services within the country.

According to Ms Christina Gold, President of the company, the US-based money transfer company is most likely to join hands with India Post, which is one of its primary agents in the global remittance business in India.

India is a growing market for global remittances. Western Union has a 16 per cent market share of global remittances.

Though India has the largest number of agent locations outside the US, the country's share in Western Union's global remittance business is less than 1 per cent, Western Union officials said.

Western Union, which has 12 primary agents in India, also plans to expand its network in rural areas, said Ms Gold. "Sixty per cent of the business is in rural areas. So we want to expand the rural network," she said.

The company is also planning to invest $50 million in India over the next few years for network expansion and brand-building, Ms Gold said. In India, Western Union has 12 primary agents, which include seven banks and India Post. It has a network of 21,000 agent locations.
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ICICI Pru leads the pack with Bajaj Allianz in pursuit
Mumbai: While ICICI Prudential still leads the private players with a new business premium income of Rs115,465 crore up to February, Bajaj Allianz Life insurance has made a dramatic jump in its position to reach the number two position pushing Birla Sun Life to number three.

As per the Insurance Regulatory Development Authority (IRDA) results for the first 11 months of FY 04-05, in terms of new business premium, Bajaj Allianz has recorded Rs49,405 crore.

This is a 333 per cent growth over last year's Rs11,396 crore. For FY 03-04, Bajaj Allianz was placed at the sixth position amongst private insurance players.
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ICRA downgrades National Insurance rating
Kolkata: ICRA has downgraded the iAAA rating assigned to National Insurance Co to iAA+. The rating agency has referred to deterioration in underwriting profitability in 2003-04, growing competitive pressures and significant audit qualifications that indicate "systemic inadequacies within the company".

The rating downgrade reflects the sharp decline in the company's profitability, ICRA has stated, while citing the qualifications made by the auditors with regard to the valuation of the company's liabilities towards policyholders.

"With the operating environment getting increasingly competitive, the profitability of the company could come under further pressure unless it takes measures to improve its underwriting practices, prune costs and improve claim management and service standards," a press release said.

The credit strengths, according to ICRA, include access to a strong investment portfolio characterised by low levels of credit risk and high levels of liquidity, appreciation in the value of the equity portfolio and a national presence.

Incidentally, the company's equity portfolio has seen considerable appreciation in 2003-04. ICRA believes it would need to increasingly rely on trading activity for improving its profitability.
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Karur Vysya Bank to offer mobile recharge facility at ATMs
Chennai: The Karur Vysya Bank has signed an agreement with the Financial Software & Systems Pvt Ltd to use its FSSNet facility, which will enable its cardholders to purchase recharge coupons for their pre-paid mobile phone connections through the bank's automated teller machine network.

Financial Software & Systems offers value-added payment services such as the mobile top-up facility under the FSSNet brand of third-party services for banks.

KVS officials said that the bank's customers could either visit an ATM each time and get their pre-paid coupons topped up or visit an ATM once and register their mobile numbers and thereafter get the coupons recharged through an SMS (short messaging service).

The bank has 3.20 lakh cardholders and over 150 ATMs across the country. Ninety four per cent of the bank's business has been brought under the core banking solution. The bank will also introduce Internet and mobile banking facilities within three months.

Financial Software & Services (FSS) officials said that the bank's customers would not be charged anything for using ATMs to recharge their pre-paid coupons. Instead, the telecom company would pay a percentage of the value - say, 5-6 per cent - of the recharge, which would be shared by Karur Vysya Bank and the company. All transactions were done online and, hence, there would be a reduction in transaction cost.
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