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PNB Gilts H1 net up 327 pc at Rs 86 crore
New Delhi: PNB Gilts has posted a net profit of
Rs 86.32 crore for the first half of the current fiscal,
a 327 per cent increase over the previous year. The company,
which saw turnover rise by 173.01 per cent to touch Rs
71,245 crore, has declared an interim dividend of 12 per
cent.
Speaking to newspersons, I.D Singh, managing director,
said: "The prevailing market conditions and good
liquidity have led to an increase in both net profit and
turnover." He added that 30 per cent of the turnover
had come from the retail segment which includes co-operative
banks, regional rural banks (RRBs) and corporates. The
total income also increased by 140 per cent to Rs 174.94
crore against Rs 72.67 per cent the previous year. Currently,
the primary dealer (PD) has 3.5 per cent share of the
gilts market. In order to grow, the company is planning
to expand its retail segment. Under existing regulations,
RRBs can deal only through sponsor banks. "We have
written to the Reserve Bank of India (RBI) asking to change
this and permit them to deal directly with the PDs,"
Singh said. However, individual investors continued to
stay away from the G-secs segment. Punjab National Bank
(PNB), the parent of PNB Gilts, is also planning to divest
its stake in company. According to existing norms, PNB
has to bring down its stake to 49 per cent from 78 per
cent. The company has already secured clearances from
the RBI and the Finance Ministry. PNB Gilts is in talks
with various players and could induct a foreign partner
as well. Singh, however, refused to divulge names of prospective
partners. On the forthcoming credit policy, he said that
he expected a further cut in the bank rate and the CRR.
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UTI
Bank net up 45 pc on retail growth in Q2
Mumbai: Buoyed by increasing retail business, UTI
Bank has registered a 45.3 per cent in net profit for
the second quarter ended September 30 at Rs 64.18 crore,
up from Rs 44.17 crore in the corresponding previous period.
Total income increased to Rs 390.77 crore (Rs 363.29 crore)
and total expenditure decreased to Rs 362.78 crore (Rs
376.23 crore). Retail banking revenue rose by 33.6 per
cent to Rs 203.96 crore (Rs 152.65 crore). Retail asset
book increased to Rs 1,405 crore from Rs 1,217 crore in
June 2003. Over the last one year, the bank has set up
specialised single-product outfits called `retail asset
centres' in the top six cities, which pushed home loans
and personal loans. According to the segmental results,
corporate banking revenue was lower at Rs 484.51 crore
(Rs 508.35 crore) with loans going at lower interest rates
in the intensely competitive market. The bank still remains
largely a corporate bank with 81 per cent of its total
assets constituting the corporate book. Other income increased
to Rs 149.82 crore (Rs 118.37 crore) with increase in
the fee income component in the merchant banking and retail
banking business. The loan syndication, project advisory
and trusteeship of debentures in merchant banking and
ATM interchange fees on the retail front were the main
drivers of growth, Dr P.J. Nayak, CMD, said. But figures
on the same were not readily available. The bank's net
interest margin rose to 2.96 per cent from 2.71 per cent
in the first quarter of the current year and cost of funds
decreased to 5.80 per cent from 6.35 per cent. UTI Bank,
which adopted the 90-day norm for recognition of non-performing
assets at the start of this fiscal, has a net NPAs ratio
at 1.97 per cent compared to 2.46 per cent at end-June
2003. Provisions and contingencies decreased in the second
quarter to Rs 69.24 crore from Rs 91.71 crore from the
first quarter.
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HDFC
Bank told to withhold recovery from S&S Power
New Delhi: HDFC Bank has been restrained from executing
the recovery certificate, obtained from the Debt Recovery
Tribunal (DRT) against S&S Power Switchgear Ltd (SSPSL),
by the Board for Industrial and Financial Reconstruction
(BIFR). The BIFR bench while reserving its order on sickness
of S&S Power Switchgear, manufacturers of power switchgears,
said, "HDFC Bank was not permitted at this stage
to execute the recovery certificate obtained by them."
The Bench in its recent order observed that Indian Bank,
Bank of Baroda (BoB), Central Bank of India (CBI), HDFC
Bank, IDBI and ICICI Bank, had reiterated their objections
to the sickness of the company on grounds of diversion
of funds and write-off, provisioning for bad debts and
lease rentals.
Further,
while the representative of BoB had requested for permission
to initiate legal action against the company, the representative
of HDFC Bank had sought permission for execution of the
recovery certificate obtained through DRT. The BIFR Bench
observed, "investments in ICDs was a short term investment,
normally only for three-six months. The fact that the
ICDs had not been repaid so far but had been rolled over
several times indicated that it was in the nature of a
term loan. Further, ICDs were unsecured loans and a negative
lien did not create any security for repayment of the
ICDs."
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Canara
Bank to float ECB bonds
Bangalore: The public sector Canara Bank Ltd is
tapping the foreign currency markets for raising $50 million
through the bond route. Banking sources said here that
the issue was being lead arranged by Citibank. The borrowing
is essentially short term with a maximum maturity profile
of one year. Canara Bank is the first public sector bank
to tap the external commercial borrowing (ECB) for raising
funds. The only other bank that has tapped this route
recently was the ICICI Bank to raise $300 million. The
sources said that the bank's issue was competitively priced
at 46 basis points over the London Interbank offered rate.
One year LIBOR is currently about 1.40 per cent. This
spread, which is an all-inclusive cost, is by far among
the lowest at which a domestic financial institution has
raised funds in the market. ICICI Bank issue was priced
considerably higher at about 106 basis points over Libor.
These spreads are, however, slightly higher than the one-year
foreign currency non-resident deposit rates offered. One
year FCNR deposit rates are currently in the region of
about 1.09 per cent. Despite, the low cost, however, the
sources said that Canara Bank was not prepared raise longer
maturity borrowings. This is unlike ICICI Bank, whose
ECB has a maturity profile of 5 years. Yields on US treasuries
are currently at least 100 basis points over last year's
and are expected to continue for some more time. The yield
on the ten-year US Treasury is currently in the region
of about 4.4 per cent. Consequently, if the dollar markets
were to harden further, borrowers would likely get locked
into high cost debts.
Banker
also said that Canara Bank's caution were also due to
expectations that domestic interest rates in the long
term were likely to remain soft for some more time. In
fact expectations are that there was likely to be another
round of repo rate cuts in the peak season credit policy
to be announced early next month from the current level
of 4.5 per cent. Among the key factors pushing banks into
the ECB markets is the high demand from corporates for
foreign currency loans.
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South
Indian Bank branch at Malappuram dt.
Kochi: The Thrissur-based South Indian Bank opened
its 400th branch at Kottakkal in Malappuram district on
Friday. The new branch was opened by Dr P.K. Warrier,
managing trustee and chief physician of Kottakkal Arya
Vaidya Sala. A. Sethumadhavan, chairman, presided over
the meeting. The function was graced by the presence of
various dignitaries, eminent personalities from the field
of politics, agriculture and business community as well
as several customers of the bank, a fax from the bank
has said.
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Dhanalakshmi
Bank to market UI products
Kochi: The Thrissur-based Dhanalakshmi Bank has
tied up with United India Insurance Company, in order
to market insurance products through all the bank's branches.
The bank had a network of 160 branches and a total business
turnover of Rs 3,000 crore, a fax from the bank has said.
The bank planned to break new grounds with the implementation
of wide area network ATMs, any branch banking, Internet
banking, cash management services etc. in the near future.
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Dewan
Housing net rises 14 pc
Mumbai: Dewan Housing Finance Ltd has reported
an increase of 13.8 per cent in net profit year-on-year
for the quarter ended September 30, 2003. Net profit increased
from Rs 4.63 crore during the corresponding period of
the previous quarter to Rs 5.27 crore this quarter. Income
from operations grew 10.7 per cent from Rs 32.15 crore
to Rs 35.62 crore. For the half year ended September 30,
net profit rose 14.5 per cent to Rs 9.83 crore (Rs 8.58
crore), with income from operations up by 12.6 per cent
at Rs 68.5 crore. Interest costs increased only 6.3 per
cent to Rs 47.75 crore (Rs 44.75 crore). Sanctioned loans
as on September 30 amounted to Rs 205.18 crore, 10.3 per
cent higher than the year-ago figure of Rs 186.6 crore.
The fall in interest rates coupled with stability in the
residential market had led to increased growth in the
company's portfolio, said Mr Kapil Wadhawan, Managing
Director, DHFL. He said DHFL proposed to continuously
explore the growing securitisation market and to come
out with a securitisation issue shortly. The company is
aggressively looking at expanding its branch network across
the country. Its acquisition into Vysya Bank Housing Finance
Ltd has resulted in Rs 200-crore increase in the asset
base as well as a customer base increase of 7500.
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