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Rupee
unchanged - securities up
Mumbai: The rupee was little changed
against the dollar on Thursday closing at 43.89/90.
Forwards
market: The 12-month premium closed at 0.62 per cent
(0.6) and the 6-month at 0.60 per cent (0.55).
G-Secs:
The 10.25 per cent 16-year 2021 paper closed at
Rs126.60 (7.36 per cent YTM), up from Wednesday's level
of Rs126.49 (7.37 per cent YTM). The 5.69-13 year-2018
paper closed at Rs87.38 (Rs7.20 per cent YTM), marginally
higher than the earlier level of Rs87.36 (Rs 7.20 YTM).
The 7.38 per cent 10-year 2015 paper closed at
Rs102.75 (6.99 per cent YTM).
Call
rates: The inter bank rates closed at 5-5.05 per cent
(4.95-5).
Reverse
repo: In the one-day auction, the RBI received and
accepted 45 bids amounting to Rs35,870 crore.
CBLO
market: 227 trades, for Rs7,596.40 crore, in the rate
range of 4.61- per cent, were realised.
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Exim
Bank extends LoC to Mali and Ivory Coast
Mumbai:
The Export-Import Bank of India (Exim Bank) has extended
a line of credit (LoC) of US$26.8mn to Government of Cote
d'Ivoire (Ivory Coast) and another LoC of US$27mn to the
Government of Mali under the Team-9 initiative.
The
LoC to Cote d'Ivoire has been earmarked for financing
a project for renewal of the urban transport system in
Abidjan and for agricultural projects in the area of vegetable
oil extraction, fruits and vegetable chips production,
production of cocoa, coffee etc.
The
LoC to Mali is being extended for financing rural electrification
and setting up agro machinery and a tractor assembly plant
in Mali.
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World
Bank study urges review of rural lending policy
Hyderabad: The World Bank, through a study, has
suggested that the Indian Government revisit its policy
of setting interest rate `caps' on rural lending rates
and `floors' on deposit rates, as the high transaction
costs and collateral requirements were making banking
unattractive for the rural poor.
In
its latest study titled, "Scaling-up access to finance
for India's rural poor," presented here on Thursday,
the World Bank economists have observed that the Government
policy on interest rates had the opposite effect of what
was intended — poor borrowers were cut off from access
and ended up paying higher interest rates to informal
lenders.
Similarly,
the economists have also urged the Government could re-look
the priority sector lending, since the prescribed quotas
were not being fully observed by the commercial banks
and often circumvented through means such as subscription
to National Bank for Agriculture and Rural Development
(Nabard) and Small Industries Development Board of India
(SIDBI) bonds.
It
has also asked banks to come out with more flexible products
and services through streamlining procedures aimed at
reducing the transaction costs. It has also suggested
expanding the outreach of micro-finance through self-help
group bank linkage and MFIs.
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Assocham
asks for investment of excess SLR funds in PSUs
New Delhi: An Assocham — Haribhakti study
has said that the government should allow commercial banks
to invest up to 20 per cent of their excess statutory
liquidity ratio (SLR) funds in the equity of state-owned
enterprises that have been identified for divestment.
"The
government should consider offering additional stakes
in PSUs to banks and retail investors," according
to a white paper on 'Equity conversion option' jointly
released by Assocham and the Haribhakti research team.
Banks
have to park 25 per cent of their incremental deposits
with the Reserve Bank as part of the SLR requirement.
Most banks park more than the required limit since they
cannot deploy the funds elsewhere.
The
study suggests that retail investors should also be given
the opportunity to put their money in the equity of these
PSUs. Such an investment option should be offered to them
when small savings deposits come up for redemption, according
to the study.
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PwC
study says offshoring of financial services to double
by 2008
Bangalore:
According to a PricewaterhouseCoopers survey the scale
of off shoring in the financial services sector is set
to virtually double by 2008. The survey, entitled 'Offshoring
in the Financial Services Industry: Risks and Rewards'
was launched on Thursday.
A
quarter of participants currently offshore between 10
per cent and 20 per cent of their headcount, however,
in three years' time, almost half the respondents expect
the amount to double. Cost saving was the main reason
for off shoring for 79 per cent of the 156 executives
surveyed. In the longer term 74 per cent of financial
services firms saved costs by off shoring activities.
However,
the benefits were less immediate in the first year of
the project; nearly a third of survey participants actually
experienced no change in costs in the first year after
off shoring functions and 15 per cent of respondents reported
no change in cost base even after five years of off shoring.
Other benefits of off shoring identified by those surveyed
were strategic flexibility and improved quality of service.
It
is not just transactional activities, which will be sourced
offshore in the future. Knowledge-based activities such
as financial research and modeling will be off shored
by 2008 says the study.
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UCO
bank and Franklin Templeton tie up for distribution of
MF products
Kolkata:
The UCO bank has tied up with fund house Franklin
Templeton for the distribution of the latter's Mutual
Fund (MF) products in the bank's branches across the country.
UCO
bank officials said that the bank would train a dedicated
team of officials for marketing the MF products and was
aiming to earn a fee-based income of Rs500 crore from
it.
Franklin
Templeton currently has Assets Under Management (AUM)
of Rs17,000 crore and an investor base of more than one
lakh.
UCO
bank has 1700 branches across the country and four overseas
centres.
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