Industrial Investment Bank of India to shut down
Kolkata: The Kolkata based troubled development financial institution, the Industrial Investment Bank of India, will soon be closed down, ending a long drawn uncertainty over the fate of the long-term lender laden with non-performing assets. The government for the past three years has been working on a revival strategy for IIBI and that included options like merging it with IDBI or Punjab National Bank at different points of time.

However now it has been decided that IIBI would be closed down. ON Singh, the acting chairman cum managing director of the troubled FI said the future of the bank burdened with NPAs of Rs 2400 crore became uncertain when both IDBI as well as PNB told the finance ministry that they are not ready to absorb IIBI.

Singh said the total staff strength of IIBI is 160 and all of them would be absorbed into various banking entities.
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Postal deposits may lose TDS exemption
New Delhi: Soon the interest earned on fixed or recurring deposits held in the post office could be taxed.

The income tax department is mulling withdrawing the tax-deducted-at-source exemption on instruments such as fixed, recurring deposits and the national savings certificate offered by the department of posts.

The finance ministry had last month clarified that tax deducted at source (TDS) is applicable on the senior citizens savings scheme, operated by the department of posts.

The issue of withdrawal of the exemption was raised at the meeting of chief commissioners and directors-general of income tax earlier this week. Officials said that several instruments offered by the department of posts did not pay TDS and the matter has come under examination.
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Govt mulls stock options for PSU banks' staff
Mumbai: The finance ministry is working on a proposal to start an Employees Stock Option Scheme (ESOS) for state-owned banks as part of the incentives to be offered to staffers to boost performance and to retain the talent pool in such banks.

According to top government officials, the government is working on a proposal to kick off an ESOS for state-owned banks with a limit of up to one per cent of the bank's capital. To begin with the scheme could cover only senior level management staff of the banks only or those manning board level positions in banks.

Later, once the scheme is unveiled it could be widened to cover staffers in other positions, officials said. The other form of compensation which the government has favoured is providing bonus to employees with a cap of one per cent of the bank's net profit.
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India's Maruti, Mahindra tie up for vehicle finance
Mumbai: India's biggest car maker Maruti Udyog has tied up with the non-banking finance firm Mahindra & Mahindra Financial Services Ltd to provide retail financing for its vehicles, the companies said on Saturday. The agreement would help Maruti tap rural and semi-urban areas where Mahindra & Mahindra Financial has a good reach, a statement from the company said.

Maruti is 52.2 percent owned by Japan's Suzuki Motor Corp. while Mahindra & Mahindra Financial is a subsidiary of M&M the tractor and utility company.
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