Bank Of Maharashtra net rises 53 per cent in ’03
Pune: The ground for a probable IPO by Bank of Maharashtra is ready with the bank turning out a good performance for 2002-03. Net profit jumped by 53 per cent while operating profit is up 25.43 per cent. Deposits grew by 15.92 per cent while advances grew by 15.18 per cent. NPAs declined from 5.81 per cent to 4.82 per cent. The net worth of the bank during 2002-2003 rose to Rs 980.27 crore from Rs 697.72 crore in the previous year with increase in reserves. SC Basu, CMD, Bank of Maharashtra, has set a target for taking the bank’s total business to Rs 50,000 crore and a depositor base of 10 million by 2005. The bank’s good performance was attributed to lower exposure to corporate borrowing and a larger share of retail borrowing, which witnessed a steady growth during the year. Despite reduction in PLR and competition the bank managed to increase its spread to 3.01 per cent from 2.91 per cent. The profit has come from core banking, he said with retail segment, comprising small traders, SSI, agriculture giving the bank better returns.
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Public sector banks race ahead with automation in Kerala
Thiruvanathapuram: They may well have been ignored as also-rans, but nationalised banks in Kerala are getting their act together and hitching a ride on the automation bandwagon, forcing their private sector competitors to sit up and take notice. Central Bank of India, Bank of India and Syndicate Bank are among those who have taken the lead and are now busy migrating from their legacy systems to the latest enabling environment to offer services that are in conformity with the latest business paradigms. For instance, Bank of India, among the top nationalised banks, is going full steam ahead with their branch automation and networking plans in the State. Working on setting up leased circuit is progressing fast and the bank plans to interconnect all 26 branches from Thiruvananthapuram to Kozhikode. According to Muralidharan, chief officer, IT, zonal office, Ernakulam, the central server will be located at Ernakulam itself. The 26 branches in Kerala will be part of the 750-odd being networked across the country.
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Pension scheme not for pvt insurance cos
New Delhi: Concern over the subsidy bill has forced the government to decide to keep in abeyance the demands of private life insurance companies to participate in the assured returns pension scheme for senior citizens — the Varishtha Pension Bima Yojana. The scheme, which was announced in the Budget, would remain the exclusive preserve of the Life Insurance Corporation of India (LIC). A decision on whether to allow private players to offer the scheme would be taken after assessing the response that LIC gets once the scheme is put on offer. "We would like to wait and see what response LIC gets to the scheme over a period of time before our next move," they said. A review of the functioning of the scheme could be done within the current fiscal. "We would have to give it a go for a few months," officials said. Details of the scheme are being worked out by LIC and are likely to be announced shortly.
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Treasury gains: PSBs do an encore
Chennai: Net profits have zoomed up once again for public sector banks in 2002-03. This time they have grown on the average by around 60 per cent. This comes on the back of a 100 per cent growth in fiscal 2002. Profits have come in once again from treasury gains - through profits made on sale of government securities. There was a significant appreciation in the prices of government securities last fiscal as yields on government paper dropped to new lows. Yields on 10-year government paper have dropped to around 5.8 per cent, a drop of nearly 150 basis points during the past fiscal ended March 2003. This drop in yields came on the back of another 300 basis points drop in the previous fiscal ended March 2002. At the end of fiscal 2002, when banks had reaped a bumper harvest through treasury profits, it was widely seen as a one-time affair and not expected to be repeated this year.

In the early part of fiscal 2003, this appeared to be coming true as it looked as though government borrowings would once again overshoot the budget (in view of what then seemed to be war preparations against Pakistan). Yields on government paper even began to climb for a short period, but they resumed their gradual descent. This helped banks to once again post phenomenal gains from selling government securities. Treasury profits ranged from around 67 per cent of net profits in the case of Canara Bank (around Rs 674 crore) to around 144 per cent in the case of Indian Bank (around Rs 273 crore) or 171 per cent in the case of UCO Bank (Rs 355 crore).
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SBT net up 41 per cent; to pay 50 pc
Thiruvanathapuram: State Bank of Travancore has recorded a 41-per cent rise in net profit during 2002-03 and the board of directors has declared a dividend of 50 per cent (30 per cent during last fiscal) subject to approval from the Reserve Bank.
Announcing the results, an SBT spokesman said here that the earnings per share touched Rs 342.08 (Rs 241.86) and the book value Rs 1,445.60 (Rs 1,220.28). The net NPA came down by 2.66 per cent to a new low of 3.06 per cent. The capital adequacy ratio stood at 11.30 per cent and the net worth went up to Rs 723 crore (Rs 610 crore). The credit-deposit ratio (for Kerala) has improved to 48.07 per cent (46.13 per cent) while the credit plus investment to deposit ratio looked up to 53.79 per cent (52.09 per cent).
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Faster money transfer from Australia now
Mumbai: Western Union, international money transfer service provider, on Thursday said its new agreement with Australia Post would enable Indians in Australia to send money back home faster. Western Union, which had recently tied up with the Australia Post, already has a similar tie-up with Indian Post. Addressing a press conference here, Anil Kapur, regional director, Western Union, said its service was available across 5,000 post-offices in India. Through this, consumers can quickly, safely, and reliably pay bills and transfer money around the globe using the company's proprietary money transfer network. Kapur said, "Through these tie-ups we tend to focus on speed and convenience for the customers, as they can operate it even without opening a bank account. For the time being the company would be concentrating on inwards money transfer." Western Union's global agreements also included China, Indonesia, Singapore, Fiji, and New Zealand. The service charges for money transfer might vary from less than one per cent to about three to four per cent differing from country to country, Kapur said.
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ICICI Bank buys auto finance co
Mumbai: ICICI Bank is to go aggressive with its auto channel financing business with the 100 per cent takeover of the Mumbai-based, auto-dealer finance company, Transamerica Apple Distribution Finance Ltd (TADFL). The shares of TADFL will be extinguished and the entity will be one with the bank. "The bank has taken over 100 per cent of TADFL in an all cash deal. The auto-dealer finance company with an asset book of over Rs 200 crore is to be renamed ICICI Distribution Finance Company Ltd and merged with the bank,'' said a senior official in ICICI Bank. This will give ICICI bank assets and increased business in the finance of dealers' inventories,especially in two-wheelers and tractors, where the company has its expertise and clientele. The size of the deal is approximated at Rs 74 crore.
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AP: Depositors turn the heat on 3 co-ops
Hyderabad: Three urban co-operative banks in the town, characterised as weak banks, are now facing the heat, as depositors have pressed the panic button and are withdrawing monies on a large scale. According to a rough estimate, close to Rs 3 crore may have been withdrawn from these banks during the past three days. The Jampeta Urban Co-operative Bank, the Aryapuram Urban Co-operative Bank and the Innispeta Urban Co-operative Bank are the three weak banks under pressure. In application of the provisioning norms, they have been categorised as weak banks which, in the prevailing atmosphere of distrust in the wake of a series of co-operative bank failures in Hyderabad, seems to have triggered the panic.
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Lukewarm response to Rs 5,500-cr OMO
Mumbai: The Reserve Bank of India (RBI) on Thursday received a lukewarm response to its open market operation (OMO) of the 6.72 per cent 2014 paper to mop up Rs 5,500 crore. Despite the current surfeit of liquidity in the inter-bank, the RBI received 215 bids worth Rs 5,467 crore while it accepted 206 bids for Rs 5,367 crore at 5.9294 per cent cut-off yield. “The cut-off yield is on the higher side compared to the other 11-year paper 7.27 per cent stock, which traded on Wednesday at a yield of 5.82 per cent.

So, there was a devolvement as the central bank does not want to give a signal that the yield might go up,” a dealer with a private bank said. On the other hand, market participants expected the yield on this paper might go up after the OMO. So, there was tepid response to the OMO.
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RBI moots pvt recovery agencies under DRTs
Mumbai: The Reserve Bank of India (RBI) has put up a proposal to the ministry of finance (FinMin) to allow debt recovery tribunals (DRTs) to seek the services of private agencies for realisation of banks’ dues after the settlement procedure gets through. At present, the job is being done by recovery officers, most of whom are on deputation from the central government services. The RBI proposal comes since it is often cited that recovery officers do not have the expertise and experience on legal matters.
RBI suggests that a recovery officer should not have more than 300 cases at any point in time. The RBI has also pointed out the need to appoint presiding officers having knowledge of banking law. The suggestions are expected to give a shot in the arm to the DRT system. There have been talks on delays in DRT proceedings as the system is saddled with huge number of cases and is grappling with a number of problems including shortage of staffers with knowledge and experience in legal system.
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