Rupee stronger
Mumbai: The rupee gained against the US dollar on Thursday along with other currencies on the back of good foreign fund inflows. The rupee opened at 44.69/70 and ended trade at 44.71, up from Wednesday's close of 44.79.

Forwards: The forward premia was slightly higher, with the six-month closing at 1.22 per cent (1.15 per cent) and the one-year at 0.95 per cent (0.87 per cent).

Bonds: Prices appreciated in the bond market by around 10 paise in select securities of a longer tenure. Dealers said that the announcement of the Rs10,000-crore auction after trading hours on Wednesday reduced uncertainty and brought buyers into the market.

G-Secs: The 8.07-12-year 2017 paper closed at Rs106.75 (7.17 per cent YTM), lower than the earlier level of Rs106.65 (7.19 per cent YTM). The 10.25-16-year 2021 paper ended at Rs126.70 (7.33 per cent YTM), slightly lower than Wednesday's close of Rs126.64 (7.33 per cent YTM).

Call rates: The call rate remained unchanged at 5.5/5.6 per cent.

Reverse Repo: In the first one-day reverse repo auction, the RBI received one bid for Rs500 crore and eleven bids for Rs2,855 crore in the second auction. There were no bids for the repo auction.

CBLO: In the CBLO market, there were 403 trades for Rs18,836.40 crore in the range of 5.22-5.51 per cent.
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Follow-on issue from Andhra Bank opens January 16
Mumbai: State-owned Andhra Bank is coming out with a follow-on issue of 8.50-crore equity shares for meeting Basel-II norms and fund future capital requirements of the bank. The issue opens on January 16 and closes on January 20 and will have equity shares of Rs10 each for cash at a premium to be decided through a book-building process.

The price band for the issue will be fixed one day prior to the issue opening date. The bank has decided to reserve 85 lakh shares for allotment to employees and the balance 7.65 crore shares would be offered to retail investors. Out of the net issue to the public, 50 per cent shall be allocated to qualified institutional buyers, 15 per cent to non-institutional investors and the balance 35 per cent will be available for retail investors.

Post-issue, the Union Government's shareholding in the bank would come down form current level of 62.50 per cent to 51.55 per cent.

The book running lead managers to the issue are SBI Capital Markets, Citigroup Global Markets India, DSP Merrill Lynch, Enam Financial Consultants and Kotak Mahindra Capital.
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IFC increases exposure in India
Bangalore: The International Finance Corporation (IFC), the private sector arm of the World Bank, has been increasing its exposure to India gradually and by this year, ending June 30, its exposures may top US$500mn according to IFC's chief investment officer, South Asia, Anita Marangoly George. She said that the exposure last year (July 1, 2004-June 30, 2005) was US$430mn and this year, expectations are that it would be US$500mn, making the country the third largest globally where IFC has exposure.

IFC makes exposures through its environment opportunity fund. The fund provides flexible financing to innovative ventures that have a strong potential to increase environmental sustainability but need to overcome the uncertainty associated with new markets, new technologies, and new ways of doing business.

IFC's exposure in India since 1956 is US$3.6bn, while its existing portfolio is US$1.3bn. IFC exposure is focussed on companies with innovative and cutting edge technologies that have environmental benefits.

Of the total exposure in India, 80 per cent is by way of loans lent on commercial rates and 20 per cent equity, she said. Returns on equity investment in India are 10 to 12 per cent over the years, Ms George said, adding, recovery from loans is also good.
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UTI Bank to raise up to US$1bn to fund expansion
Mumbai: UTI Bank is considering issuing medium term notes to raise up to US$1bn to fund its global operations, according to Dr P.J. Nayak, chairman and managing director.

He said that the bank would open its Singapore branch by February, after which it will start the MTN programme. "As we are opening a branch in Singapore we require funds and MTNs is an attractive option," he said. The notes could be raised in tranches, he added. The bank is in the process of getting ratings from Standard & Poor's and Moody's.

Dr Nayak also said that though the amount was not finalised, initial estimates indicated the bank may need to raise up to US$1bn. The bank also plans to expand in other Asian countries, Dr Nayak said.

For remittance business, the bank has tie-ups with Doha Bank in Qatar and UAE Exchange Company.
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ING Vysya MF launches scheme targeted at women
Mumbai: ING Investment, the investment manager for ING Vysya Mutual Fund has announced the launch of 'Mahilanivesh,' which will be amongst the first investment solutions primarily dedicated to Indian women.

Under the package, any investment (selected from a pre-denominated instruction amount) will be invested in ING Vysya Floating Rate fund (an open ended income scheme) and the money will be automatically transferred in monthly installments to ING Vysya Dividend Yield Fund (an open-ended equity scheme).

The fund is targeting around one lakh women to invest with a minimum of Rs12,000 in the package.
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IDFC selects Misys' risk management solution
Mumbai: Infrastructure Development Finance Company (IDFC) has selected Misys Banking Systems' asset liability management (ALM) solution to set up a high-class risk management system for the financial firm.

According to Misys Banking Systems, its ALM will enable IDFC to make accurate and reliable decisions through sophisticated statistical analysis, well managed, auditable quality data and insightful business, economic and behavioral scenario analysis in a release here.

Misys ALM platform is built on a modular approach and common data model, and can be extended to support Basel II requirements, Funds Transfer Pricing mechanism.
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OBC to issue bonds to raise Rs.500 crore
New Delhi: Oriental Bank of Commerce (OBC) plans to raise Rs500 crore in bonds this month in order to sustain an over 20 per cent growth in business. The bank says that business is estimated to cross Rs90,000 crore by the end of this fiscal. The bank also plans to transfer about Rs105 crore from investment fluctuation reserves (IFR) to Tier-I capital.

The proposed transfer from IFR and the subordinated debt issue will help the bank to maintain a capital adequacy ratio of over 13 per cent this fiscal even after it makes extra provisions for meeting the stringent Basel-II norms. The additional capital would also enable the bank to sustain a high growth in lending.

OBC's business grew by 23.5 per cent to Rs83,000 crore till December with deposits growing by 17.7 per cent at Rs49,000 crore and loans up by 35 per cent at Rs33,000 crore bank officials said.
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SBI credit card wraps two million customers
Mumbai: SBI credit card, a joint venture of State Bank of India (SBI) and GE Money, has garnered two million customers, making it a leading player in the highly competitive and fast-growing consumer finance market.

GE Money, a leading provider of credit services, said the partnership which began in 1988 has experienced a double digit growth by combining SBI's market presence and strength as trusted brand with GE Money's global expertise in technology and business processes.

The size of the Indian credit cards market is estimated to be about US$4bn and is growing at the rate of 35 per cent per year.

GE Money said SBI Card, with its rapid expansion plans, aggressive investments in large co-branded card deals and technology to enhance customer experience, aims to be the preferred credit card provider in India for consumers across all segments of society.
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SBI to retain 15 pc of IMD money
New Delhi: The State Bank of India plans to retain about 15 per cent of the US$7.3bn that is being repaid to NRI investors of India Millennium Deposit.

Several banks including SBI, ICICI Bank, IDBI Bank, Bank of Baroda, Union Bank of India, Centurion Bank of Punjab and Life Insurance Corporation were eyeing a significant amount of the IMD redemptions that started on December 29.

IMD redemptions, coupled with high credit demand, had put pressure on the liquidity situation with over-night call money rates surging to 7 per cent in December end, well above Reserve Bank's reverse repo rate of 5.25 per cent.

However, Finance Ministry and Reserve Bank did not see much impact of the IMD redemption as the country's foreign exchange reserves were at a comfortable US$145bn.
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