17 january 2004

hdfc net increases 25% to rs 183 crore in q3
mumbai: housing development finance corporation (hdfc) has registered a 24.65 per cent growth in its net profit at rs 182.81 crore for the third quarter of the current fiscal, compared to rs 146.65 crore in the corresponding period last fiscal. hdfc's total income stood for the period at rs 747.22 crore (rs 734.94 crore).

the net profit for the first nine months stood at rs 553.81 crore (rs 451.10 crore), registering a 23 per cent rise. housing loan approvals in the nine months grew by 30 per cent to touch rs 10,390.01 crore from rs 8,004.82 crore in april-december 2002. hdfc general manager conrad d'souza said the housing finance company was expected its housing loan portfolio to grow at a similar rate.

sidbi announces vrs
mumbai: the small industries development bank of india (sidbi) is offering a voluntary retirement scheme. the first vrs of sidbi will open on january 19 and is expected to give a golden handshake to 100 employees. the rather `unexpected' vrs in sidbi coincides with the one approved in industrial development bank of india (idbi), which is awaiting implementation.
said v k chopra, cmd, sidbi: "we expect that about 10 per cent of our work force will take the package i.e., about 100 people. although sidbi is only 13 years old, it was hived out of idbi, which was in turn carved out of rbi, so we will count the full service served both at sidbi and at idbi when offering the vrs. about half of our total staff of about 1,000 people came from either idbi or rbi."

idbi issues flexibonds 20
mumbai: industrial development bank of india (idbi) is to tap the retail market through a public issue of idbi flexibonds 20 for rs 400 crore with a greenshoe option to retain an additional rs 400 crore.

idbi flexibonds-20 rated `aa+ (rating watch with developing implications)' by crisil will be open for subscription between january 19 and february 12, said a press release from idbi.

canara bank to eye ecb market again
bangalore: canara bank has made a second foray into the foreign currency market to take advantage of the low cost of funds and cheap forward premiums. a newspaper report said the bank floated a mandate for raising $50 million along with the option of retaining another $25 million of the oversubscribed amount.
the borrowing would have tenure of one year as in the last case. canara bank last forayed into the ecb market in october when it had raised $50 million. it is so far the only public sector bank to tap the foreign currency market for the second time in a row this financial year.

rural banks move rbi for 'regular' status
mumbai: the national federation of agriculture and rural development banks has written to the reserve bank of india asking for a conversion of ardbs into full-fledged banks. the conversion is expected to help ardbs who are now totally dependent on nabard funding for giving loans to become self-reliant in resources by mobilising deposits like other banks, said a press release.

k. sivadasan nair, chairman of the federation, has urged rbi to finalise the norms for conversion of state co-operative agriculture and rural development banks into full-fledged banks, the release said. the federation has also decided to fix a 9 per cent interest for farm loans up to rs 50,000 and 10 per cent from rs 50,000 to rs 2 lakh, and 11 per cent for above rs 2 lakh issued by member-banks. the federation has requested nabard to reduce interest on outstanding refinance to ardbs for extending the benefit of the present low interest to farmers who availed themselves of loans in the past at high interest rates.

16 january 2004

foreign banks allowed 100% subsidiaries
new delhi: the union cabinet has permitted foreign banks to set up wholly-owned subsidiaries in india besides raising the foreign direct investment (fdi) limit in private banks to 74 per cent from 49 per cent. it also abolished fdi caps in technical and scientific journals and the petroleum and natural gas sector. it, however, decided against a hike in foreign investment in the tele- communications sector.

foreign institutional investors (fiis) can acquire up to 49 per cent stake in a private bank but within the 74 per cent overall foreign investment ceiling. the government earlier permitted 49 per cent fdi and an equal holding by fiis, raising the foreign investment level to 98 per cent. the foreign holding will include investment by fiis, non-resident indians (nris) and stakes acquired through initial public offerings, private placements, american depository receipts and share acquisitions by existing shareholders.
though wholly owned subsidiaries have been permitted in the banking sector, the government has decided to restrict foreign banks, which have already opened branches in india, from acquiring over 74 per cent stake in an existing private bank.

idbi bank inks b2b tie-up with bpcl
mumbai: idbi bank says it has entered into a business-to-business (b2b) e-commerce arrangement with oil major bharat petroleum corporation ltd (bpcl) to provide an automated payment and purchase process to the bpcl's corporate and industrial clients.

the arrangement will ensure an easy and secure method of payment without any time-lag between realisation of payments made by corporates and clearance of supplies by bpcl. this will also have other benefits such as funds transfer at no extra cost, savings on commission and funds in the pipeline and better synergy between finance, supplies and logistics, idbi bank managing director gv nageswara rao said.

jp morgan may buy bank one for $60 billion
new york: jp morgan chase & co inc has agreed to buy bank one corp for about $60 billion, the wall street journal's online edition said. citing a person familiar with the matter, the journal reported that the purchase is expected to be announced later on wednesday. jp morgan spokeswoman kristin lemkau and bank one spokesman tom kelly both declined to comment.

a merger would preserve jp morgan's position as the no 2 us bank by assets, behind citigroup inc. no 3 bank of america corp's pending purchase of fleetboston financial corp would vault that combination past the current jp morgan. "there is a real logic to it," said bert ely, a banking consultant at ely & co in alexandria, virginia. "the only thing i would wonder about is might a competing bid come in."

15 january 2004