Rupee a tad higher
Mumbai: The rupee closed a bit higher against the US dollar on Tuesday after the Reserve Bank of India increased short-term rates by 25 basis points in the quarterly review of the monetary policy.

The rupee opened at 46.90 and touched 46.78 immediately after the announcement of the rate hike. It then dipped to 46.84 before finally ending at 46.82, 10 paise higher than Monday's close of 46.91/92.

The rupee also got support from other currencies such as the euro and pound, which advanced against the dollar.

Bonds: Although bond prices fell by around 25 paise during the day, they were almost unchanged at the end of the day from Monday's closing prices. The total traded volume on the order-matching system at Rs2,180 was relatively high as compared to the last few weeks.

Bonds: The 7.59 per cent-10 year-2016 paper opened at Rs95.85 (8.21 per cent YTM) and closed at Rs95.82 (8.22 per cent YTM), unchanged from Monday's Rs95.82 (8.22 per cent YTM). The 7.37 per cent-8 year-2014 paper opened at Rs95.82 (8.10 per cent YTM) and ended at Rs95.74 (8.12 per cent YTM), slightly lower than Monday's close at Rs95.80 (8.11 per cent YTM).

Call rates: Call rates stood between 6.00 and 6.10 per cent.

Reverse repo: In the first three-day reverse repo auction under LAF, Reserve Bank of India received and accepted 12 bids amounting to Rs6,845 crore and in the second three-day reverse repo auction, 41 bids for Rs36,480 crore. There were no repo bids.

CBLO: The CBLO market saw 343 trades aggregating to Rs19,033.60 crore in the 5.53-6.00 per cent range.
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RBI hikes key interest rates
Mumbai: The Reserve Bank of India hiked its short-term lending rates on Tuesday. This hike is set to lead to a rise in interest rates on corporate and retail loans.

The RBI hiked the reverse repo rate, which is the rate at which the RBI borrows funds from banks, by 25 basis points to 6 per cent. Consequently, the repo rate or the rate at which the RBI lends to banks rose to 7 per cent. These are the highest short-term rates in the last four years.

Dr Y.V. Reddy, Governor of the RBI, said the decision to hike the rates was a pre-emptive measure to keep inflation between 5 and 5.5 per cent in the current year.

The central bank has kept its other rates such as the Bank Rate and CRR unchanged at 6 per cent and 5 per cent respectively.

The RBI had first hiked rates in January, then in June and now in July. Most banks raised their retail lending rates and prime lending rates after each RBI rate hike.

In its first quarterly review of the Monetary Policy announced on Tuesday, the RBI has maintained the GDP growth projection for 2006-07 at 7.5-8 per cent.

It said the overall industrial outlook continues to be positive and services sector growth is expected to sustain its momentum. Its forecast for GDP growth is retained in the range of 7.5-8 per cent, during 2006-07, barring domestic or external shocks," the policy said.

According to the policy, "Developments during the first quarter of 2006-07 indicate that money supply, deposit and credit growth are running well above the indicative projections, warranting caution by all concerned in this regard."

The RBI says it will continue to ensure that appropriate liquidity is maintained in the system so that all genuine requirements of credit are met.

The RBI proposes to do this through open market operations (OMO) including Market Stabilisation Scheme, Liquidity Adjustment Facility and Cash Reserve Ratio, the review said.
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SIB signs distribution agreement with Reliance MF
Kochi: South Indian Bank has signed an MoU with Reliance Mutual Fund to distribute the latter's products. Under the agreement, South Indian Bank will distribute the entire range of Reliance Mutual Fund schemes, initially through select 200 branches and later through the entire branch network, a press release has said. This strategic tie-up is expected to increase Reliance Mutual Fund's retail footprint in the country. The initiative is also expected to benefit both the organisations in their respective growth strategies.
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YES Bank net up 50 pc
Mumbai: YES Bank registered a growth of 50 per cent in its net profit during the first quarter, ended June 30.

The bank's net profit increased to Rs16.88 crore as compared to Rs11.25 crore, during the corresponding quarter for the previous year. "The bank has continued to invest in retail business, thus increasing our operating profit by over 77 per cent to Rs29.84 per cent, which also contributed to our profit," said Rana Kapoor, managing director and CEO, YES Bank. Total income for the quarter rose considerably by 170 per cent to Rs129.39 crore against Rs48.01 crore.
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Cholamandalam DBS Fin Q1 net down
Chennai: Cholamandalam DBS Finance has reported a net profit of Rs3.53 crore (Rs7.52 crore) on income from operations of Rs60.60 crore (Rs49.26 crore) for the first quarter ended June 30, 2006.

Cholamandalam DBS Finance, a joint venture between Murugappa Group and DBS Bank of Singapore, has posted a 34 per cent growth in total disbursements in April-June 2006 over the corresponding period the previous year. The disbursements were at Rs429 crore (Rs319 crore).
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Bank of Rajasthan posts 284 pc rise in net profit
Mumbai: Bank of Rajasthan (BoR) has reported a 284 per cent growth in net profit, for the quarter ended June 30 due to a rise in income. Net profit rose to Rs20.04 crore compared to Rs5.21 crore in the corresponding quarter of the previous year.

Total income also increased to Rs185.28 crore from Rs155.08 crore, a growth of 19 per cent for the quarter. Other income also rose considerably to Rs23.08 crore (Rs19.66 crore). Net interest income went up to Rs66.66 crore (Rs51.56 crore). Total expenditure was higher at Rs150.16 crore (Rs134.56 crore).
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SIB reports tripling of Q1 net at Rs15 cr
Kochi: South Indian Bank (SIB) has almost tripled its net profit at Rs15.05 crore during the first quarter of the current fiscal as against Rs5.31 crore in the corresponding period the previous year.

The total business of the bank also increased to Rs16,545 crore from Rs13,249 crore on a year-to-year basis, registering a growth of 24.88 per cent, according to an official press release here. The deposits have gone up to Rs10,240 crore from Rs7,997 crore, while the advances have increased to Rs6,305 crore from Rs5,252 crore.
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