Rupee declines 12 paise
Mumbai: The rupee declined against the dollar as demand for the dollar rose. The domestic currency opened at 40.77/79 and closed at 40.87/88, against the previous close at 40.75/76.

Traders said that with inflows from DLF and ICICI Bank public offerings drying up, the rupee might depreciate to 41.20 by the end of the week.

In forwards, the six-month premium closed at 2.43 per cent (2.67) and the 12-month ended at 2.55 per cent (2.67).

Bonds: Bond prices rose 30 paise and the yields fell by about 5 basis points backed by comfortable liquidity in the system. The yield on the 10-year-paper ended at 8.18 per cent against the previous close of 8.23 per cent.

G-secs: The 7.49 per cent 10-year-2017 paper opened at Rs 95.44 (8.17 per cent YTM) and closed at Rs 95.40 (8.18 per cent YTM) against the previous close of Rs 95.06 (8.23 per cent YTM). The 8.07 per cent 10-year-2017 paper opened at Rs 99.70 (8.11 per cent YTM) and closed at Rs 99.70 (8.11 per cent YTM) against the previous close of Rs 99.50 (8.14 per cent YTM).

Call rates: The inter-bank call rates eased to close at 2.75-3.25 per cent on Monday against the previous close of 0.1-0.2 per cent. The Reserve Bank of India received bids worth Rs 61,070 crore through the reverse repo window, under the two sessions of liquidity adjustment while it accepted Rs 3,000 crore.

Reverse repo: In the second one-day reverse repo auction, the central bank received 28 bids for Rs 26,475 crore while it accepted Rs 1,000 crore. There were no repo bids in the first and second one-day auctions.

CBLO: The CBLO market saw 429 trades aggregating Rs 28,963.60 crore in the 0.15 per cent - 4.5 per cent range.
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UTI Bank postpones plan to raise $600mn
Mumbai: UTI Bank has postponed its $600 million global depository receipts (GDR) issue as well as the simultaneous preferential offer to its promoters in order to provide promoter shareholders - Specified Undertaking of Unit Trust of India (SUUTI), Life Insurance Corporation and General Insurance Corporation - more time to take a call on subscribing to the preferential offer the bank said.

SUUTI is the largest shareholder in UTI Bank with 27.43 per cent stake. LIC owns 10.38 per cent of the bank's equity while holds GIC 2.38 per cent.

The shareholders will again meet on July 13, 2007 to consider the capital raising plans. However, a resolution was passed for increasing the bank's authorised capital to Rs 500 crore from Rs 300 crore.

Banking sources said LIC, which bid in the recently concluded ICICI Bank's follow-on equity offer for shares worth about Rs 4,000 crore, has asked for more time to arrange for funds as it was currently experiencing a "tight liquidity" situation. SUUTI, which has already obtained the government's permission, also needs to arrange for funds to subscribe to its portion of the preferential offer.
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FIPB likely to review ICICI holding co-proposal
Mumbai: The Foreign Investment Promotion Board, which rejected ICICI Bank's proposal to divest 24 per cent in ICICI Financial Services, the holding company for the bank's insurance joint ventures, review the case again after the bank submits a fresh application.

FIPB had rejected ICICI Bank's proposal to divest 24 per cent stake in ICICI Financial Services in favour of foreign investors as a subsidiary could not take part in insurance business, the source said.

Regulation 2(g)(i) of the IRDA regulations said "Indian promoter" meant a company formed under the Companies Act, 1956 (1 of 1956), which was not a subsidiary as defined in section 4 of that Act, the source added.

The IRDA has backed ICICI Bank's proposal to set up a holding company for its insurance ventures, saying for all practical purposes the parent bank will remain the promoter of the insurance ventures.

ICICI Bank has said it has a certificate from the IRDA to the effect that it will continue to be the promoter of ICICI Prudential Life Insurance and ICICI Lombard General Insurance even with the existence of the holding company.
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SBI needs $15bn for expansion
Mumbai: State Bank of India needs capital in excess of Rs 60,000 crore ($15 billion) in the next three years to develop its business and expand globally according to SBI chairman O P Bhatt while addressing annual general meeting.

SBI, the country's largest lender, will transfer its stakes in SBI Life and SBI Mutual Fund into a holding company. The holding company will be listed on the stock exchanges to capture value of investments.

Bhatt said the bank was likely to hit the capital market with a follow-on public issue this year. It was in talks with merchant bankers and government on modes of raising capital (equity and bonds), he added.

The bank will need to raise Rs 10,000 crore to maintain the tier-I capital above 8 per cent. Its tier-I capital base is 8.01 per cent. The capital adequacy stood at 12.34 per cent at the end of March 2007.
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HSBC India net up 64 per cent
Mumbai: Hongkong and Shanghai Banking Corporation (HSBC) has reported a 64 per cent increase in net of its Indian operations for the year ended March 31, 2007. HSBC's net profit stood at Rs 846 crore against Rs 515 crore a year earlier.

HSBC's total income during the year increased by 51 per cent to Rs 4,720 crore from Rs 3,130 crore in 2005-06 while its total assets increased 47 per cent to Rs 54,987 crore from Rs 37,473 crore in the previous year.

The bank's deposits grew by 40 per cent to Rs 34,825 crore during the year, while advances rose by 38 per cent to Rs 23,142 crore.

India is among the top 10 contributors to HSBC's group profits.
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Bank of America net up 35 per cent
Mumbai: Bank of America has reported a net profit of Rs 195.5 crore for the year ended March 31, 2007, 35 per cent higher than the figures in the previous year. The bank's revenues have increased 24 per cent to Rs 674.4 crore in 2006-07.

The asset base of the bank increased to Rs 6,317.6 crore against Rs 5,965.6 crore. Banc of America Securities India, a subsidiary of Bank of America, reported a net profit of Rs8.7 crore compared with Rs7.1 crore in the previous year. On an aggregate basis, the bank's India business reported a net profit of Rs 204.2 crore, a growth of 35 per cent from the previous year.
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