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Rupee strengthens further - gains 5 paise
Mumbai: The rupee strengthened further against the dollar on Monday on the back of a revival in foreign institutional inflows. The domestic currency closed at 43.81, up from Friday's level of 43.86/87. The price of global crude, which eased to US$66.90, also aided the recovery.

Forwards market: The 12-month closed at 0.61 per cent (0.5 per cent) and the 6-month closed at 0.52/53 per cent (0.45 per cent).

G-Secs: The 10.25-16 year-2021 paper closed at Rs126.41 (7.38 per cent YTM) against its Friday close at Rs126.06 (7.42 per cent YTM). The 7.37-9 year-2014 paper closed at Rs102.55 (6.97 per cent YTM), higher than Friday's close of Rs102.42 (6.99 per cent). The 7.38-10 year-2015 paper was dealt at Rs102.50 (7.03 per cent YTM), up from Friday's Rs102.35 (7.05 per cent YTM).

Call rates: The inter bank rates closed at 4.90-5 per cent.

Reverse repo: In the one-day auction, the RBI received and accepted 50 bids amounting to Rs51,390 crore.

CBLO market: 261 trades for Rs11,750.15 crore in the rate range of 4.60 and 5 per cent.
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RBI issues revised guidelines for settlement of NPAs in the SME sector
Mumbai: The Reserve Bank of India (RBI) has issued revised guidelines for one time settlement scheme, aimed at the recovery of non-performing assets (NPAs) below Rs10 crore.

According to a RBI notification, these guidelines will provide a simplified, non-discretionary and non-discriminatory mechanism for one-time settlement of chronic NPAs in the SME sector. All public sector banks shall uniformly implement these guidelines, the notification said.

While the guidelines will not cover cases of willful default, fraud and mal-finance, RBI said, the banks shall identify such cases and initiate prompt action.

It will also cover cases on which the banks have initiated action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and also cases pending before Courts/ DRTs/ BIFR, subject to consent decree being obtained from them.

The revised guidelines will cover all NPAs in SME sector which have become doubtful or are a loss as on March 31, 2004 with outstanding balance of Rs10 crore and below, on the date on which the account was classified as doubtful.

The guidelines will also cover NPAs classified as sub-standard as on March 31, 2004, which have subsequently become doubtful or there is a loss where the outstanding balance was Rs10 crore and below on the date on which the account was classified as doubtful.

The last date for receipt of applications from borrowers will be as at the close of business on March 31, 2006. The processing under the revised guidelines shall be completed by June 30, 2006, the notification added.
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BoI to augment Tier II capital through bonds issue of Rs.750 crore
Mumbai: The Bank of India will augment its Tier-II capital by raising Rs750 crore through private placement of unsecured redeemable non-convertible subordinated bonds, it has informed the Bombay Stock Exchange.

The bank will make the private placement of the bonds with a greenshoe option of Rs 250 crore. The bank will use the funds to meets its expanding credit requirements, capital adequacy requirements in line with the Basel II norms and to repay the earlier Tier-II capital.
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GE Money launches used-car finance scheme - Face2Face
Pune: GE Money has launched a used-car finance initiative - GE Money Face2Face.

According to company officials Face2Face would provide buyers and sellers a platform to meet face-to-face and close transactions on their own terms. Buyers would get up to 90 per cent financing and the repayment tenure would be up to 72 months.

As per the scheme, the customers would have to bring their cars to the exclusive showrooms operated by GE Money Face2Face franchisees and quote the price they would be looking at. Designed as one-stop shops for buying and selling used cars, these exclusive showrooms would be located in seven cities across the country. These seven locations would be ready by January 2006.

The first location would be in Pune.

As for the expansion programme of GE Money India, officials said it would be expanding its current branch network from 118 in 60 cities to 200 branches across 110 cities.

It would also be expanding its presence in the western region from 43 to 84 branches and Pune would have seven of these.
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Usha Martin board clears GDR issue of US$25mn
Kolkata: The board of directors of Usha Martin Ltd has approved the issue of GDRs/FCCBs of up to US$25mn (Rs110 crore) along with a green shoe option of 20 per cent, and a preferential issue of convertible warrants to promoters.

The proposed GDRs/FCCBs shall be listed on the Luxembourg Stock Exchange. An extraordinary general meeting of the company has been convened on September 28 to seek shareholders' approval.

According to a company press release issued here, the board of directors has cleared the proposal to issue 58 lakh convertible warrants to the promoters' group and associates. Each warrant would be priced at Rs153 in respect of each share of the face value of Rs5.

The proposed allottees have agreed to subscribe to the warrants at the stipulated price by making an upfront payment of 10 per cent and exercise their option to convert the warrants into equity shares by paying the balance 90 per cent of the consideration. The equity shares thus allotted shall be subject to a lock-in period of three years from the date of issue of the warrants.

Usha Martin proposes to fund its expansion programme through a combination of GDRs, convertible warrants, internal accruals and debts. The board of directors has approved a capital expenditure plan of Rs462 crore that would be spent on strengthening the company's wire and wire rope business, expansion of its steel making capacity and expenditure on coal mining activity, the release adds.
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