IDFC signs agreement with BOB
Mumbai: Infrastructure Development Finance Company (IDFC) has entered into a Memorandum of Understanding with Bank of Baroda (BOB) for enhancing finance and banking services provided to entities involved in infrastructure development. Both parties would co-operate for finding new processes to speed up debt financing to enable quicker financial closure for infrastructure projects, IDFC informed the stock exchanges.

They would also work with each other to provide other banking products and services such as letters of credit, treasury products, trade finance products, advisory services, financial and performance guarantees to infrastructure clients, it said.
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Kotak Insurance expects 70-75 per cent premium growth
Mumbai: Kotak Life Insurance is expecting a year-on-year premium growth of 70-75 per cent from Rs 190 crore it collected in 2005. Out of the total premium collected, rural areas contributed around 16-17 per cent with the company currently having rural branches in Gujarat, Haryana and Maharashtra.

In Gujarat, Kotak has 10 rural branches, which would be increased to 20. Kotak Life Insurance has insured many NGOs such as SEVA in Gujarat and also many NGOs based in the dairy industry.
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LIC to launch first unit linked group gratuity scheme
New Delhi: Targeting the long-term savings of the salaried class the Life Insurance Corporation plans to launch its first unit linked group gratuity scheme by the end of March.

LIC executive director, R Venugopal, said the company has sent the proposal to the Insurance Regulatory and Development Authority for approval. Though this is the first unit linked pension plan, LIC has three unit linked plans in the life insurance side - Jeevan Plus, Future Plus and Bima Plus.

LIC is the second largest pension fund manager in the country, after the Employees' Provident Fund, with a corpus of Rs 43,000 crore as of March 2005. LIC 's new business premium in pension and gratuity schemes (P&GS) till January 31, 2006 stood at Rs 2, 732 crore by covering 36.75 lakh lives under 7,982 schemes.

He demanded withdrawal of fringe benefit tax on superannuation schemes, which is affecting the group business of most of the insurance companies.
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South Indian Bank prices FPO at Rs 66 per share
Mumbai: South Indian Bank has set the cut-off price for shares to be alloted under the follow-on public offer (FPO) at Rs 66 per share. The cut-off-price has been decided on the recommendation of the book running lead managers - ICICI Securities and Enam Financial Consultants.
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Special RBI audit of Sahara Fin
Mumbai: Sahara India Financial Corporation will have to call back its investments in various group companies in the first quarter (April-June) of the financial year 2006-07, as a high-level audit team of the Reserve Bank of India is conducting an on-site inspection of the country's largest residuary non-banking finance company (RNBC).

Sahara India Financial Corporation will not have any discretion regarding its investments of public deposits in the April-June quarter meaning that its entire deposit portfolio will have to be invested in instruments stipulated by the RBI. These include government securities, deposits of other banks and corporate bonds with double-A+ (AA+) and above rating.

Sources close to the development said, "This is one of the reasons Sahara sold off its airline. It will not be able to make any fresh investment in any of its ventures from the public deposits in the RNBC arm," he said.

Sahara India Financial Corporation's deposit base is worth around Rs 12,000 crore and the company declined to comment on the development.

Besides Sahara India Financial Corporation, two more RNBCs are also subject to the same set of regulations one of them being Kolkata-based Peerless General Finance and Investment Company.

In 2004-05, RNBCs could use 20 per cent of their aggregate liabilities to depositors for discretionary investments the rest being directed investment. In 2005-06, the discretionary investment quantum was reduced to 10 per cent and from the next financial year beginning April, there will not be any discretionary investment for RNBCs.

Though Sahara India Financial Corporation has made representations to the RBI for relaxation of this norm the regulator has not changed its stance. It is likely that the Sahara group may go for a restructuring following this said the sources.

The company's 2003-04 annual report shows long-term investments in Sahara India Mass Communication, Sahara Asset Management Company, Sahara Airlines, Sahara India Corporation, Sahara Hospitality, Sahara India International Corporation, Sahara India Mass Media Communication, Sahara India Medical Institute, Sahara Sanchar and Sahara India Life Insurance Company.
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