Rupee volatile; ends unchanged
Mumbai: Though the rupee was volatile against the US dollar, it ended almost unchanged from the previous close on Friday. The rupee opened at 45.20 and touched a low of 46.26 before closing at 46.12/13, the same as Thursday's close. "There was dollar demand from importers." As the rupee continued to depreciate, exporters cancelled their forward dollar covers helping the home currency to stem its losses.

The forward premia opened higher but came down later. In the forward premia market, the six-month closed at 1.26 per cent (1.25 per cent) and the 12-month at 1.32 per cent (1.30 per cent).
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Oriental Bank to foray into life insurance
Kolkata: Oriental Bank of Commerce (OBC) proposes to foray into the life insurance sector, and is mulling forming a joint venture company including a tie up with overseas partners.

The bank has decided to roll out a corporate branch in Mumbai, which will be required to report to its headquarters. OBC is also considering raising Rs500 crore Tier II capital this year. The bank recorded a business of Rs89,000 crore last fiscal and hopes to scale it up to about Rs1 lakh crore by the end of the current fiscal.
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Reinsurance to BAG's rescue
Coimbatore: Bajaj Allianz General has reported a 52 per cent increase in its premium income and 10 per cent rise in its profit last year. According to Kamesh Goyal, chief executive officer Bajaj Allianz, profits were hit due to the unexpectedly large flood claims of close to Rs1,000 crore last year. Mumbai floods alone the company Rs350 crore (in claims settlement). He said good reinsurance arrangement helped the company to tide over the situation.

The company has managed to bring down its management expenses by investing in IT systems. The company plans to focus on geographical expansion, target higher profitability and growth in underwriting profit and overall improvement in business performance during the current year.

Its branch network is expected to reach 100 from 65 at present. In certain places such as Bangalore, New Delhi and Mumbai, Bajaj Allianz General is planning to establish more than one branch.
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IFFCO-Tokio premium revenue up
New Delhi: IFFCO-Tokio General Insurance Co Ltd (ITGI) has reported a 79 per cent growth in premium revenues at Rs896 crore and a profit before tax of Rs24.1 crore for the year ended on March 31, 2006.

ITGI increased its share capital by infusing Rs120 crore last year, taking the total share capital to Rs220 crore. As per the latest Insurance Regulatory and Development Authority figures, the company has a market share of 4.4 per cent as compared to 2.88 per cent last year.
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IRFC raises Rs810-cr through bonds
New Delhi: Indian Railway Finance Corporation (IRFC), the financing arm of Indian Railways, has raised Rs810 crore through the issue of bonds in the domestic market recently. IRFC is budgeted to raise a total amount of Rs4,170 crore for Indian Railways in the current fiscal. The amount has been raised at a weighted average cost of 8.31 per cent with a 15-year tenor. The bonds have a bullet repayment scheme which means that the principal amount has to be repaid at the end of the tenor.
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CRR interest loss to hit PSU banks
Mumbai: The public sector banking will take a hit of over Rs1,600 crore on its bottom line next year, as the RBI has stopped paying interest on CRR balance from June 24, due to amendment in the RBI Act. The public sector banking industry registered a net profit of Rs26,272.48 crore in 2005-06.

Banks are required to keep 5 per cent of their net demand and time liabilities (NDTL) with the RBI in the form of CRR.

They do not earn interest on the entire cash balance, though the RBI has been paying 3.5 per cent interest on cash balance above 3 per cent and up to 5 per cent. Inter-bank borrowings, even though part of banks' NDTL, are not subjected to CRR.

A brokerage house has estimated that the abolition of interest payment on CRR will shave off 4.5-5 basis points from the banks' net interest margins (NIM) in FY07 and around 6 basis points in FY08.

However, the impact will be less if the RBI brings down the CRR. The State Bank of India, the country's largest commercial bank, had a cash balance of Rs19,572 crore, followed by Canara Bank (Rs7,285 crore), Bank of India (Rs5,304 crore), Union Bank (Rs4,190 crore) and Oriental Bank of Commerce (Rs3,943 crore).
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United Bank ties up with Fitch
Kolkata: Rating agency Fitch India has tied up with United Bank of India to rate small-scale sector enterprises. The tie-up will help the bank's existing SSI customers across the country take advantage of getting special pricing for ratings.

Under a special scheme of government, SSI can claim upto 75 per cent of the total fees of the rating fees subject to a maximum limit.

SSIs with a turnover of upto Rs50 lakh will get a maximum subidy of Rs25,000, the limit is Rs30,000 for turnover between Rs50 lakh to 200 lakh and the amount would be Rs40,000 for turnover over Rs200 lakh.

There are around one crore SSI units, and out of which 18 lakh are registered with National Small Industries Corporation (NSIC). The scheme will only be applicable to SSIs registered with NSIC.

UBI said it would offer concessional rate of interest to SSI from eight per cent to 12.75 per cent depending on the rating.
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