Line of credit only via Exim Bank: Govt
New Delhi: As part of its export initiative, the government has taken a decision to route all line of credit (LC) through the Export-Import bank. “The Exim Bank has played a major role in promoting exports which have crossed the $50 billion mark during 2002-03. The government has now taken a decision to route all LCs through our bank”, the general manager and regional resident representative Sunil Trikha said. He said the Exim Bank was currently negotiating a 15 million line of credit with the Afro Exim Bank and already had a $200 million LC for import into Iran. Besides a 10 million LC is also functional with a bank in Algeria, he said adding a $5 million LC was also operational with the eastern and southern African trade and development bank (PTA bank). The PTA bank member countries include Burundi, Comoros, Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Malawi, Mauritius, Rwanda, Somalia, Sudan, Tanzania, Uganda, Zambia and Zimbabwe and Trikha.
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Reinsurance outlook negative: S&P
New Delhi: Global rating agency Standard & Poor’s has indicated a negative outlook for reinsurers for the sixth year in a row.“Continued rate increases in the global reinsurance market have failed to stem the downward pressure on ratings and market outlook remains negative for the sixth successive year,” it said in a recent report. There may, therefore, be more rating downgrades than upgrades over the short-to-medium term, it cautioned. “Despite further price increases during the January 2003, renewal season, the market continues to suffer from a diminished quality of capital, reduced financial flexibility (defined as the ability to source capital relative to requirements), prior-year liabilities, the overhang of reinsurance recoverables, and the likelihood that many companies’ operating performance will fall short of expectations,” S&P credit analyst Stephen Searby said. The report, entitled “Global reinsurance 2003 mid-year outlook: Negative outlook masks divergent fortunes,” states that pressure on ratings continues despite the hard market conditions. A number of reinsurers have been finding it difficult to take advantage of the situation “to rebuild and restructure their capital bases and put in place foundations to reduce future loss volatility.” S&P cited the “ease of entry for new players and increased competition in the market” as limiting the “ability of existing players to recover.”
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IDBI rules out credit sops to HFCL
New Delhi: Industrial Development Bank of India (IDBI) has refused to entertain a request for concessions on the line of credit granted to telecom equipment major, Himachal Futuristic Communications Ltd, amounting to Rs 230 crore plus interest, asking it to honour the repayment commitments. As per the terms of the line of credit, the company had to repay the outstanding amount in 12 quarterly instalments commencing March 1, subject to the condition that it maintains two quarterly interest balance on the amount. It was also stipulated that the proceeds of the GDR, issued by HFCL in September 2002, would be utilised for prepayment of the credit facility.
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BoB aims at 18.2 pc credit offtake growth
Kolkata: Bank of Baroda (BoB) is looking at an 18.2 per cent growth in credit off-take nationwide during the current fiscal. M.M. Gadgil, deputy general manager, told newspersons here that the eastern zone, however, was expected to show better credit off-take than the national average. "It is projected to move up by around 20 per cent,'' he added. BoB's advances went up by 5.01 per cent in 2002-03 despite the lending rate cut. Off-take, particularly in the retail and housing finance areas, was expected to witness significant growth, according to him. The bank has targeted reduction of non-performing assets by about 50 per cent during 2003-04. During 2002-03, the bank's net NPA fell to 3.72 per cent from 4.98 per cent of the total advance in the previous fiscal.
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SBI Life offers cover for SSI loans
Hyderabad: SBI Life Insurance Company Ltd has designed an insurance cover , which would be accepted by all bankers as collateral against loans to the SSI sector. If something were to go wrong either with the SSI unit or with the promoter, bankers can now stay cool. They can recover their money from the insurance company. The product of SBI Life, titled `Swadhan', offers
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NMGB records 24.86 pc rise in net profit
Thiruvanathapuram: The Kannur-based North Malabar Gramin Bank (NMGB) has recorded 24.86 per cent increase in net profit for 2002-03. The net profit of the bank moved up to Rs.11.30 crore from Rs. 9.05 crore in the previous year. The deposits rose by 24 per cent and reached Rs. 519.67 crore. Out of this, the non-resident external deposit amounted to Rs. 69 crore, according to the chairman, V. Nadanasabapathy. The advances were to the tune of Rs. 449.85 crore, of which the priority sector accounted for 91 per cent. The credit-deposit ratio of the bank was at a healthy level of 86.56 per cent. The non-performing assets were at Rs. 65.84 crore with a recovery rate of 76 per cent. The reserves stood at Rs. 86.6 crore and the chairman pointed out that NMGB was one of the two regional rural banks, out of a total of 196 at the national level, which had not been recapitalised by the government. During the year, the bank opened five branches in Ernakulam district, taking the total number of branches to 152. The area of operation of the bank covered Kannur, Kasaragod, Wayanad, Ernakulam and Kottayam districts. The per branch business increased to Rs. 637.84 lakh, while the per employee productivity was at Rs. 97.64 lakh.
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