ICICI Bank cuts home loans by 25-50 bps
Mumbai: Amidst intense competition, ICICI Bank has reduced its floating interest rate for home loans by 25 to 50 basis points (bps) effective from Monday to become the cheapest financier in the segment. The bank’s home loan offering is cheaper by almost 25 bps to its closest competitors like the State Bank of India (SBI) and HDFC in all housing finance tenure.

The bank has offered an uniform rate of 7.5 per cent for all tenors till November 26, as a special festival offer. The revised rates for loans up to five years will be 7.5 per cent (earlier 7.75 per cent) while that for 6-20 years will be 7.75 per cent. In the case of 6-20 years, two brackets of 6-10 (eight per cent) and 11-20 years (8.25 per cent) have been merged.

It has also announced a 0.5 per cent reduction in its home prime lending rate. This will ensure that existing floating rate customers can also benefit from this scheme.

"With the ongoing reduction in our cost of funds and the continuing soft interest rates in the system, we are pleased to offer a corresponding benefit to both our existing and new customers," executive director Chanda Kocchar said.

On the special festival offer, he said customers availing of the balance transfer scheme during this period (till November 26) would also benefit from zero fees for home loans transferred to the bank from their existing bank/housing finance company.

HDFC, last month, unveiled a Diwali bonzana scheme by offering home loans at 7.75 per cent for up to 20 years under floating basis from October 27 to November 5, which was extended till November 8. SBI had reduced interest rates of housing loans with effect from October beginning. SBI’s floating rate up to 5 years is pegged at 7.75 per cent, above 5 years and up to 15 years at 8.25 per cent. The bank’s rate above 15 years and up to 20 years is 8.50 per cent. SBI’s fixed rate of interest up to 5 years is fixed at 8.00 and above 5 years and up to 15 years it is 8.5 per cent. For above 15 years and up to 20 years it is 8.75 per cent.
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Tayals open to increasing stake in BoR to 49%
Kolkata: Tayals, the principal stakeholders in Bank of Rajasthan (BoR), are open to increasing their stake in the bank from 43 per cent now to 49 per cent, according to BoR chairman PK Tayal.
"We are open to the idea of increasing our stake in Bank of Rajasthan up to the Reserve Bank of India’s permissible limit of 49 per cent. However, we are not sure by when we will be able to do that. I wish to increase the stake to 49 per cent just now. But we will have to do that according to the cash flow," he said at a press conference here on Monday.

Tayal said that as on March 31, 2003, BoR’s total deposit base was Rs 6,000 crore and total advance at Rs 2,300 crore. "We plan to increase the deposit base to Rs 12,000 crore and advances to Rs 6,000 crore by 2006," he said, adding that BoR’s net non-performing assets (NPA) as a percentage of total advances were at eight per cent as on March 31, 2003. "We are confident of bringing down the net NPA figure to two per cent within the next couple of years," he said.

He said that BoR had recovered around Rs 250 crore of NPAs during the past four years as against a write-off of Rs 100 crore during the same period. "The accumulation of fresh NPAs during the past four years has almost been negligible," Tayal said, adding, the bank’s capital adequacy ratio has been comfortable at 15 per cent as on March 31, 2003, as against the RBI-stipulated norm of nine per cent. He said that BoR had issued 100 notices under the newly promulgated Securitisation Act, involving a total default amount of Rs 100 crore.
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Central Bank Of India mulls major branch consolidation
Mumbai: The state-owned Central Bank of India (Central Bank) is going in for rationalisation of its branch network in a big way. "The bank will go for branch consolidation by merging branches in the areas, where business growth has reached almost a saturation point and opening new branches or converting existing extension counters and satellite offices into full-fledged branches in areas where business and commercial activities are picking up,' a senior bank official said.

The bank is not planning any further expansion of its branch-network as it entails large investment. The emerging business environment, with a focus on technology and speed of service delivery mechanism like internet and ATMs, has also left little scope for branch expansion by the bank, already having a large network.

The bank recently merged four of its branches, converted five extension counters and one satellite office into full-fledged branches and converted three branches into satellite offices. 'We are planning further consolidation of our branch network in the states of Maharashtra, Uttar Pradesh, Madhya Pradesh, Bihar, West Bengal and Gujarat,"the source said.

The bank merged three branches in Mumbai and one in Ahmedabad. The branches, which were merged in Mumbai are Jhaveri Bazar, Khand Bazar and Null Bazar. In Ahmedabad, the Manik Chowk branch was merged with Gandhi Road branch.

The bank is, however, considering a proposal to open overseas banking units (OBU) in special economic zones (SEZs) in the country. As on March 31, 2003, the bank has a total of 3,117 branches-1,419 in rural areas, 743 in semi-urban areas, 539 in urban areas and 416 in metropolitan areas.
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Andhra Bank revises NRE rates
Hyderabad: Andhra Bank has revised interest rates on term deposits under non-resident external rupee accounts (NRE accounts) with effect from Monday. The revised interest rates are 1.7 per cent (existing 1.55 per cent) for deposits of one year to less than two years, 2.4 per cent (2.05) for deposits of two years to less than three years and 3 per cent ( 2.65 per cent) for deposits of three years.
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Dewan Housing gets $12.5-m IFC term loan
Mumbai: Dewan Housing Finance Corporation Ltd has obtained a term loan equivalent to $12.5 million from International Finance Corporation, a World Bank arm.

This loan is for funding of the company's housing finance operations. The company's focus on the semi- urban and rural area as well as lower income segments also fits well with IFC's loan policies, said a news release from the company.

"DHFL is increasingly focused in the semi urban and rural parts of the country and expects to see greater volumes in these areas," said Wadhawan. "We are also expanding aggressively by opening service centres in the smaller towns, which is the fastest growing segment for housing finance."

Earlier this year, DHFL acquired an 85.91 per cent equity stake in Vysya Bank Housing Finance Ltd. DHFL has 42 branches in over 151 convenience centres across the country.
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