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ECB norms modified with immediate effect
Mumbai: The Reserve Bank of India has modified the norms for External Commercial Borrowings with immediate effect.

Under the new norms ECBs with a minimum average maturity of five years, to be issued by non-banking financial companies (NBFCs), multilateral financial institutions, reputable regional financial institutions, official export credit agencies and international banks, in order to finance import of infrastructure equipment for leasing to infrastructure projects would be considered by the RBI under the Approval Route.

Foreign Currency Convertible Bonds by housing finance companies satisfying specific criteria would also be considered under this route.

Pre-payment of ECBs up to $200 million (as against the existing limit of up to $100 million) may be allowed by authorised dealers without prior approval of the RBI, subject to compliance of applicable minimum average maturity period for the loan. Pre-payment of ECBs for amounts exceeding $200 million would be considered by the RBI under the Approval Route.

Currently, domestic rupee denominated structured obligations are permitted by the government to be credit enhanced by international banks / international financial institutions / joint venture partners. The RBI, under the Approval Route, would henceforth consider such applications.

RBI has issued these norms after considering the concerns raised by the policy to allow NGOs to raise ECBs.
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Electronic matching system for gilts trading launched
Mumbai: The Reserve Bank of India's electronic order matching system, for trading in government securities, has been launched on its Negotiated Trading System.

The electronic order matching system (NDS-OM) will co-exist with the telephone-based trading system as well as the exchange-based trading mechanism, RBI said in a release on Friday. The use of the new trading module is voluntary.

During the first phase, the NDS-OM will serve the trading requirements of all banks, primary dealers and financial institutions regulated by RBI that hold current NDS membership. Other NDS members will be extended access in the next phase. The option of extending NDS-OM to non-NDS members will be examined in due course, the release said.

The system will be purely order-driven, with all orders being matched based on strict price/time priority.

The system will be an anonymous order matching system wherein identity of parties is not revealed before or at the time of trade.

The Clearing Corporation of India Ltd will become the central counter-party to each trade done on the system. The system will allow straight-through processing and trades executed will flow straight to CCIL in a ready-for-settlement stage.
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Kerala State development loan 2015 auction slated for August 4
Mumbai: The Kerala government has announced the sale of a 10-year Kerala State Development Loan 2015 for a notified amount of Rs250 crore through a yield-based auction using the multiple price auction method. The auction will be conducted by the Reserve Bank of India at Mumbai on August 4, said an RBI note issued here.

The results will be announced on the same day and payment by successful bidders will be accepted during banking hours on August 5 at Mumbai and Thiruvananthapuram.

The stock will qualify for the ready forward facility, the note added.
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LKB offers rupee drawing facility at Dubai
Kochi: Lord Krishna Bank has entered into a rupee-drawing arrangement with Al-Razouki International Exchange Company in Dubai, facilitating Indian expatriates to remit funds back home through select branches of the bank.

LKB said this facility would be effective from August 1.
"With this the bank has inward money transfer arrangement with six exchange houses in West Asia , besides having similar arrangement with a number of banks globally," it said.
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Banking Results: Karnataka Bank, Yes Bank, LIC Housing

Karnataka Bank Q1 net up at Rs.42 crore
Karnataka Bank Ltd has recorded a net profit of Rs41.69 crore during the first quarter ended June 30 against Rs38.73 crore in the same period last year, registering 7.6 per cent growth.

The total income stood at Rs288.38 crore (Rs312.58 crore) during the quarter. Interest income rose to Rs240.64 crore (Rs207.71 crore). Other income was down at Rs47.74 crore (Rs104.87 crore). The bank recorded an operating profit of Rs87.94 crore (Rs117.23 crore).

The capital adequacy stood at 13.83 per cent (14.8 per cent) as at the end of June. During the period, the net NPA stood at 2.14 per cent.

The bank has also said that it aims at a business turnover of
Rs20,000 crore for the current financial year.

The bank, which has 385 branches, plans to open 15 more during the financial year in select metro and urban centres. The release also said that the bank is planning to extend core-banking solution at 35 more branches enabling `anywhere banking' facility at 315 branches by the end of the current year. With this, the bank plans to cover 92 per cent of its business through core banking solution, the release added.

Yes Bank Q1 net at Rs.11 crore
Yes Bank's total income for the period under review fell to Rs48.01 crore from Rs48.15 crore in the period ended March 31,05. Interest income was at Rs28.99 crore, against Rs29.98 crore in the previous fiscal. Other income was at Rs19 crore, as compared to Rs18.1 crore for the previous fiscal.

According to the bank, fee income (advisory fees and trade income) accounted for Rs11.5 crore of other income. Interest expenses were Rs15.6 crore, as against Rs11.9 crore in the previous fiscal, while operating expenses were at Rs15.5 crore, as against Rs39.9 crore in the previous fiscal.

Capital adequacy ratio (CAR) was at 10.07 per cent as on June 30, 2005, compared to 18.81 per cent on March 31, 2005.
The bank had raised Rs315 crore through an IPO in June. This increased its net worth to Rs520 crore from Rs215 crore.

Advances were at Rs874.4 crore, while deposits stood at Rs874.2 crore. The bank's balance sheet size increased to Rs3,030.3 crore as on June 30, 2005, from Rs1,274.4 crore on March 31, 2005.

According to the bank, advances have been made to corporates and emerging corporates (small & medium enterprises) and currently there are no retail advances. Only around 3 per cent of the deposits are from retail.

Yes Bank has six branches and will add another six in this quarter. By December, Yes Bank expects to have around 30 branches. It has also kicked off wealth management, insurance and MF distribution. The bank will start retail advances in the form of personal loans in the October quarter.

LIC Housing Q1 net up 20 per cent at Rs.50 crore
LIC Housing Finance Ltd has posted a net profit of Rs50.18 crore for the quarter ended June 30, up 20 per cent from Rs41.87 crore in the year-ago period.

The company sanctioned loans to the tune of Rs1,016 crore, up 10 per cent from Rs927 crore earlier, while loan disbursal was up eight per cent at Rs1,005 crore (Rs931 crore).

LIC Housing's interest income on core portfolio was 16 per cent higher at Rs271 crore (Rs233 crore), while interest expenses amounted to Rs193 crore (against Rs160 crore).

The company's outstanding mortgage portfolio as on June 30 stood at Rs12,889 crore, up 26 per cent from Rs10,222 crore earlier.
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