Bank credit up twenty per cent for the quarter
Mumbai: The credit offtake at the top 100 banking centres has risen by 19.8 per cent till June 2004 as against 10.3 per cent growth recorded a year ago, as per RBIs quarterly statistics on the deposits and credit of scheduled commercial banks.

Bank deposits at the top 100 banking centres, which account for 64 per cent of the total deposits, went up 22.4 per cent up to June 2004 over 14.4 per cent registered up to June 2003, the RBIs quarterly report has stated.

The credit deposit (C-D) ratio of scheduled commercial banks at all-India level stood at 58 per cent, with Chandigarh topping the list at 102.4 per cent followed by Tamil Nadu (89.8 per cent), Maharashtra (79.9 per cent).

At the bank group level, the report says that the C-D ratio was highest for the foreign banks at 88.9 per cent, while for other scheduled commercial banks it stood at 67.6 per cent.

The ratio stood lower for State Bank of India and associates (56.4 per cent), nationalised banks (53.4 per cent) and Regional Rural Banks (47.4 per cent).
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Insurance business up 14 per cent
New Delhi: Private and PSU insurers have pushed general insurance business up by 14 per cent to Rs7,709 crore till August this fiscal, according to data released by the IRDA.

India's leading PSU insurance company New India Assurance has seen a marginal hike in its market share to 22.12 per cent. While the PSUs - New India, National Insurance, Oriental Insurance and United India - have together posted a 7.3 per cent growth, the private players led by ICICI Lombard expanded by 52 per cent, according to IRDA data.

ICICI Lombard led private insurers with 4.38 per cent share followed by Bajaj Allianz with 4.25 per cent share market.

Even though ICICI Lombard registered 72.59 per cent growth in gross direct premium at Rs337 crore, Bajaj Allianz was growing at a faster pace of 78.87 per cent at Rs327 crore in August.

Tata AIG, which registered 28.49 per cent growth, stood third among private insurers with market share of 2.74 per cent. IFFCO-Tokio cornered 2.59 per cent of the market, growing at a pace of 38.38 per cent, while Royal Sundaram held 1.7 per cent market share, growing at 19.13 per cent.
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TIIC initiatives to bring down lending rates
Chennai: Through an agreement with SIDBI (Small Industries Development Bank of India) and the State Government the Tamil Nadu Industrial Investment Corporation (TIIC) plans to bring down its lending rates to small and medium enterprises by about 2 percentage points.

Through the agreement with SIDBI and the State Government, TIIC will be able to access SIDBI refinance at 7.5 per cent against the current variable rates of 8 - 10 per cent. Its term loans, along with the Central and State subsidy schemes, are effectively pegged around 10.5 per cent. The agreement will also provide for converting about Rs61 crore of loans from the State Government to equity. This will help TIIC improve its capital base.

TIIC has also taken up with banks certain steps to retire some of its high cost debts - about Rs411 crore that carry an interest of about 14-15 per cent. Through these measures, TIIC has set for itself a lending target of about Rs275 crore during the current year against Rs200 crore last year. Some of the focus areas include windmills for captive power generation, which has emerged as a major area of investment for the textile industry. TIIC has a special rate of 10.5 per cent for windmill projects. Other areas include light engineering, automobile components and textile units.

Under the National Equity Fund, the average interest rate is about 8.5 per cent and is ideal for automobile component units.

The last financial year was a turnaround for TIIC which had speeded up loan recovery and clearing bad debts. The total recovery including principal and interest was about Rs 350 crore. In tandem with the internal restructure that has helped significant savings on interest for TIIC, it was able to bring down its cost of funds to 10 per cent from 13.75 per cent, sources said.
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