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Team-9 initiative: US$15mn LoC to Equatorial Guinea from Exim Bank
Mumbai: At the behest of the Government of India, the Export-Import Bank of India (Exim Bank) has extended a Line of Credit (LoC) of US$15mn to the Government of Equatorial Guinea, byway of financing exports from India for a potable drinking water plant project.

The credit has been extended through the Team-9 initiative, under which the Government of India provides credit lines through the Exim Bank to the member countries to finance setting up of various projects by Indian companies in those countries.

As per the terms of credit to Equatorial Guinea, Exim Bank will reimburse 100 per cent of contract value to the Indian exporters, upfront, upon the shipment of goods.

"India's trade level with Equatorial Guinea is currently low. India's main exports to the country in 2004-05 were primary and semi-finished iron and steel, meat and preparations, drugs and pharmaceuticals, and plastic and linoleum products. This LOC will pave the way for boosting trade with Equatorial Guinea substantially," said a release from Exim Bank.
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Increased autonomy for PSU banks coupled with accountability
New Delhi: Heeding the call of the Indian Banks' Association (IBA), which had urged the government to increase the salaries of CMDs and EDs in order to bring it on par with their counterparts in the private sector banks, finance ministry sources indicate that the raise is likely to be effected, but through allowances. The quantum, however, is yet to be decided and the sources indicate that a decision on the matter is likely to be taken soon.

The issue had been raised by the IBA as part of the demand for increased autonomy for public sector banks.

Meanwhile, finance minister P Chidambaram has said that the government was ready to give the bank boards more autonomy but, in turn, they would also have to become more accountable. The minister has underlined that the bank boards would be pulled up in case they fail to meet the projected targets given in their statements of intent. In case the bank boards failed to meet the projected targets, strict action would be taken against them.

According to sources, the finance ministry would work towards establishing total parity between private and public sector banks, and allow them to adopt a hire and fire policy as well. Finance ministry sources maintain that consolidation would be the key to create big and strong banks, which would be globally competitive.
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LIC Housing to shift focus to project finance
Chennai: LIC Housing Finance expects a four-fold increase in its disbursements this year with a changed focus towards project financing. LIC officials said that the changed focus has resulted from the fact that returns from such financing are higher.

Consequently, the company has forecast that project financing disbursements will increase to Rs1,850 crore in 2005-06 from Rs443 crore the previous year.

Project disbursements are loans given to real estate builders for promoting residential projects. The interest rate asked of the builders for projects is slightly higher compared to the interest rate paid by retail customers for housing loans.

According to LIC officials, with interest rates hardening, the company expects to make profit from its project disbursements within the fiscal. LIC estimates a growth of up to 25 per cent during the current financial year.

The company's total disbursements was Rs4,650 crore in 2004-05, of which about Rs4,207 crore came from housing loans to individuals.
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Bajaj Allianz Life ties up with Bombay Mercantile Co-op Bank
Mumbai: Bajaj Allianz Life Insurance Company has entered into a bancassurance tie-up with the Bombay Mercantile Co-operative Bank.
According to a press release, bancassurance contributes 30 per cent of the new business of Bajaj Allianz Life.
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