Repay 25 pc to ICICI Bank by Oct 21, DRT tells Mardia Chemicals
Mumbai: The Debt Recovery Tribunal of Mumbai has issued an order to Mardia Chemicals to pay up 25 per cent of the outstanding amount to ICICI Bank by October 21, 2003. This works out to roughly Rs 98 crore. Only after this amount is paid to ICICI Bank, the Debt Recovery Tribunal III (DRT III) will take up the affidavit-cum-reply filed by Mardia Chemicals in its defence. The company in its affidavit says that it cannot pay the whole outstanding amount since it has not fallen due yet. The repayment of the five loans availed of, is over an eight-year period.
The DRT III in its order states, "The affidavit-cum-reply is accepted subject to deposit of 25 per cent of the outstanding amount with the applicant bank, within fifteen days. The amount so deposited be adjusted towards the outstanding.'' The DRT order comes even as the Mardia Chemicals case against ICICI Bank's attempts to seize and sell its assets, is scheduled to come up for hearing in the Supreme Court on October 31. The case was earlier scheduled for hearing on October 17, which has now been postponed to the end of the month. The company owes Rs 1,450 crore (including principal of Rs 800 crore and balance unpaid interest) to 22 lenders, including Bank of Baroda, Bank of India, Corporation Bank, Union Bank, IDBI, Life Insurance Corporation, IFCI and New India Assurance. The exposure of ICICI Bank to the Ahmedabad-based, dyes and dyes intermediaries company, is Rs 110 crore (principal amount) and with interest works out to Rs 392 crore. The Supreme Court hearing on the case is expected to pronounce decisions on the time frame banks can adopt between serving a notice to a defaulter, seizing assets and sale to realise their value and protection measures to defaulting borrowers of small amounts. The private sector bank had issued a notice in July to Mardia and on expiry of the required 60-day period, it took over the assets of the closed unit in consultation with all lenders.
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NHB reduces lending rates
New Delhi: Home loans may become cheaper still with the National Housing Bank (NHB) slashing its lending rates by 0.40-0.65 per cent, just two weeks before the Reserve Bank announces its busy season Credit Policy. The refinance rate (the rate at which NHB lends to housing finance companies (HFCs) for agriculture and rural development banks, apex co-operative housing finance societies and regional rural banks have been reduced by 0.25-0.50 per cent. The new rates are applicable from October 1, 2003, the release said. To boost the rural housing sector, NHB would further drop its refinance rates by 0.25 per cent to various institutions for loans up to Rs 10 lakh. NHB's loan disbursement increased 10-fold to Rs 790 crore last fiscal ending June 2003, from Rs 76 crore in 2001-02, the release added.
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Dhanalakshmi Bank picks i-flex for tech upgradation
Bangalore: The private sector Dhanalakshmi Bank Ltd has picked up i-flex Solution for its technology banking initiative. The Dhanlakshmi Bank managing director and chief executive officer, B. Muthuswamy, said that the bank had selected Flexcube Dealer for treasury operations. It has integrated its treasury operations, foreign exchange and domestic money markets and shifted the same from Kerala to Mumbai. The implementation of the technology initiative would cover 93 branches. In addition, the bank would also be setting up a data centre in Bangalore and a disaster recovery centre in Ernakulam as part of this process.
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RBI should allow rupee to appreciate, says Assocham
New Delhi: The Associated Chambers of Commerce and Industry (Assocham) has suggested that the Reserve Bank of India should allow the rupee to appreciate further instead of intervening actively in the forex markets thereby pushing up the reserves, as the difference is not expected to be great. In a paper brought out by the chamber on `Managing India's foreign exchange reserves', it has stated that one of the most important functions of reserves is to ensure macroeconomic stability and stability of exchange rate in the country. The RBI should, however, gain confidence from the comfort provided by the high reserves, the chamber said. The reserves allow the central bank to push forth towards aligning the domestic monetary policy with the international best practice norms, albeit incrementally. "While the RBI ceiling on the interest rate offered to the NRI deposits is a welcome move, the fact remains that the interest rates offered are more than what they would get in their home country. Since these type of deposits are highly volatile, sitting on the back of about $85 billion, we can withdraw this deposit scheme completely and reduce some burden on the exchequer," the chamber said. Assocham further stated that the easing of restrictions by the RBI was a positive move and it should further liberalise the use of foreign exchange. Additionally, the paper says that RBI should ensure the quality of the reserves. "The yield from the foreign exchange is usually pretty low. The RBI should do some portfolio research in order to maximise its returns from the reserves." "In the new era of multilateralism, the government can make use of the reserves to give strategic aid to developing countries with which it has identical interests," it says.
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IDBI Bank to adopt SAS credit risk tool
Mumbai: IDBI Bank has decided to implement SAS India's SAS Credit Risk Management Solution across its retail assets division. Pramod Vaidya, head risk management, IDBI Bank, said: "At IDBI Bank we were looking at enhancing our risk management initiative in retail banking in line with our plans on being Basel II compliant by 2006. We needed a solution that would assist in understanding the credit worthiness of customers and facilitate the development of risk scorecards for home loans, personal loans and define pre-approved credit lines for individuals. SAS demonstrated superior delivery capabilities, analytical prowess, high level of GUI and technical and domain skills."
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