Bajaj Allianz profit growth falls
Mumbai: Bajaj Allianz General Insurance has reported a net profit of Rs52 crore in 2005-06 — a growth of 11 per cent from Rs47 crore in the previous year. The company said the lower growth was mainly due to the high claim payouts after the Mumbai floods and other natural disasters in the previous fiscal. The company's total claim payout was around Rs750 crore, of which around Rs400 crore was due to natural catastrophes. The company received 2.31 lakh claims compared to the previous year's 1.45 lakh.

The gross written premium for the fiscal was Rs1,285 crore, a 50 per cent growth from Rs856 crore in the previous year.

Bajaj Allianz General has received `AAA' rating from ICRA for its claim paying ability.
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Karnataka Bank targets advances growth at 32 per cent
Mumbai: Karnataka Bank has set a target of 32 per cent growth in advances in the current fiscal, up from 22 per cent in 2005-06. Ananthakrishna, chairman, Karnataka Bank, said the bank hoped to increase its advances to Rs10,000 crore this fiscal, from Rs7,800 crore in the previous year. The focus of lending according to Ananthakrishnan would be on lending to the SME segment.

Karnataka Bank's total business last fiscal was Rs20,700 crore, of which Rs13,000 crore were deposits and the advances were Rs7,700 crore. The bank would soon take a decision on hiking its PLR (prime lending rate) from the current 12 per cent.

According to him Karnataka Bank would soon be part of a non-life insurance joint venture where it will hold a stake of around 15 per cent. The other partners include Allahabad Bank (36 per cent), Indian Overseas Bank (19 per cent), Dabur (10 per cent) and Sompo Japan insurance company (26 per cent). The joint venture has approached IRDA for a license and will be operational in this fiscal. Karnataka Bank will infuse capital of around Rs10-15 crore in the venture.
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All States should adopt VAT if CST is to be phased out
New Delhi: "It would be very difficult to abolish or even reduce CST, if all States do not adopt value added tax (VAT)," said Dr Parthasarathi Shome, advisor to the Union Finance Minister. Tamil Nadu and Uttar Pradesh — and the Union Territory of Pondicherry are yet to adopt VAT.

Addressing an Assocham meeting, Dr Shome said there was yet another complication in abolishing or reducing CST. In the absence of a credible IT-based information system, there will always be a tendency to inflate inter-State trade, Dr Shome said. He added that this tendency would get a fillip if the CST rate was reduced and the IT system was not in place.

"It only shows that the CST component in tax revenues is very high and crucial for the States. It is not very easy to remove CST or even decrease it in the wake of constraints and reservations," he said.

Dr Shome also made it clear that the CST phase-out issue has not been put on the backburner and expressed hope that Tamil Nadu would implement State-level VAT after the Assembly elections. As regards Uttar Pradesh, he said that the State was still in the process of convincing its traders about the merits of VAT.
Annual CST collections stood at about Rs18,000 crore. The ceiling rate on CST stands at 4 per cent.
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ATM fees hiked
Mumbai: the National Financial Switch (NFS) promoted by the Reserve Bank of India has acceded to the demand from large banks for a withdrawal of the 50 per cent reduction in transaction charges.

The NFS, managed by RBI's Institute for Development and Research in Banking Technology (IDRBT), has restored the charge per transaction for ATM use to Rs18 from Rs9.

After NFS reduced the transaction charge in October 2005, ICICI Bank withdrew some of its heavily-used ATMs in Mumbai from the NFS platform. It subsequently included the withdrawn ATMs back into the NFS platform following negotiations.

State Bank of India (SBI) had also delayed its participation in the NFS, as a result of the cut in transaction charge.

SBI has the largest ATM network with 5,700 ATMs and ICICI Bank has the second largest network of 2,200 ATMs across the country. The participation of SBI will make NFS a network of 12,000 ATMs.

Daily average transactions on the NFS network are around 17,000. Currently, 19 banks including are members of NFS. SBI's participation will take the number up to 20.
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