RBI directs banks to implement export package
Mumbai: The Reserve Bank directed all commercial banks to reduce interest rates on export finance by two percentage points following government's decision to grant subsidy to exporters hit hard by rise in rupee value.

The two percentage points interest subsidy should be given to nine sectors - textiles, leather products, readymade garments, handicrafts, engineering products, sports goods, processed agriculture products, marine items and toys.

The benefit would extend to small and medium exporters whose investment in plant and machinery does not exceed Rs10 crore.

With this, credit to these categories of exporters will be available at 4.5 per cent less than the prime lending rate, which is in the range of 12 per cent. Earlier, the difference was 2.5 per cent.

This rate will apply to pre-shipment and post-shipment credit disbursed between April and December 2007.
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Corp Bank Q1 net up 23 per cent at Rs23-cr
Mumbai: Corporation Bank has posted a 22.78 per cent increase in net profit at Rs177.11 crore for the quarter ended June 30, as compared to Rs144.24 crore for the same quarter last year. The total income increased 38.39 per cent to Rs1238.83 crore for the first quarter ended June 30, from Rs895.11 crore a year ago, Corporation Bank informed the Bombay Stock Exchange.
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HDFC, Citi cancel tie-up for cross-sales
Mumbai: Housing Development Finance Corporation (HDFC) and Citigroup have cancelled the tie-up under which the American bank's India network would start selling the Indian bank's loan products.

The two entities had signed an operating agreement for cross-selling each other's products after Citigroup increased its stake in HDFC to 12.3 per cent and nominated its representative on the HDFC board.

Citigroup now say its stake in HDFC is a financial investment.

Banking sources said Citigroup and HDFC are not going ahead with their plan as it would have created a conflict of interest between HDFC Bank and its promoter, HDFC. HDFC Bank has not launched its own home loan products and instead sells HDFC loans for a fee. HDFC holds around 23.32 per cent in the bank.

HDFC and Citigroup had plans to expand their cross-sell relationship beyond home loans, which were to be sold based on the mortgage lender's risk criteria.
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Lufthansa talks to Taj group, credit card firm for frequent flyer programme
Mumbai: German airline major Lufthansa is talking with the Taj Group for integrating the airline's frequent-flyer programme, Miles and More, and is also planning to tie up with a credit card service provider for the same.

An announcement in this regard is likely to take place in India next month (August).

The deal with a credit card service provider will mean that a Lufthansa passenger, who is a frequent flyer, can secure miles for the money he spends through that particular card.

In the case of Taj Hotels, passengers will earn more miles if they stay more in the group's hotels.

Lufthansa, which is looking at enhancing flights from Indian destinations to Europe, is also planning to increase its advertisement spend in India.

At present, Lufthansa operates daily flights to Hyderabad, New Delhi, Mumbai, Chennai and Bangalore from Frankfurt, apart from daily flights to New Delhi from Munich and three weekly services to Kolkata from Frankfurt.
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