Rupee marginally weaker
Mumbai: The rupee declined marginally against the US dollar due to demand for dollars from importers. The currency opened at 46.50 and touched an intra-day high of 46.44, to finally close at 46.46/47, lower than Thursday's close at 46.44/45

Forwards: In the forward-premia market, the six-month premium ended at 1.43 per cent (1.38 per cent) and the 12-month premium at 1.37 per cent (1.33 per cent).

Bonds: Bond prices were volatile but ended lower on Friday due to profit-booking. The volume was high at Rs5,990 crore on the order-matching system.

G-secs: The 7.59 per cent-10-year-2016 paper opened at Rs97.10 (8.02 per cent YTM) and touched a high of Rs97.45 (7.97 per cent YTM). It then dropped to close at Rs97.06 (8.03 per cent YTM), lower than Thursday's close of Rs97.15 (8.02 per cent YTM). The 9.39 per cent-5 year-2011 paper opened at Rs107.02 (7.63 per cent YTM) and closed at Rs106.90 (7.66 per cent YTM), down from Rs107.11 (7.63 per cent YTM) on Thursday.

The auctions of the 8.07 per cent 10-year 2017 Government security and the 8.33 per cent 30-year 2036 G-Sec were fully subscribed.

In the case of the 8.07 per cent G-Sec, the notified amount was Rs5,000 crore. The RBI received 314 competitive bids amounting to Rs15,732.60 crore. The cut-off price was Rs99.62 (8.123 per cent YTM). Of these, the RBI accepted 53 bids for a total amount of Rs4980.25 crore, it said in a statement.

Call rates: Call rates remained unchanged between 6 per cent and 6.10 per cent.

Reverse repo: In the first three-day reverse repo auction under LAF, the Reserve Bank of India received and accepted 20 bids amounting to Rs13,035 crore, and in the second three-day reverse repo auction, 38 bids for Rs16,955 crore. There were no repo bids.

CBLO: The CBLO market saw 296 trades aggregating to Rs15,151.50 crore in the 2.10-6.15 per cent range.
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Centurion to acquire LKB in Rs300-cr deal
Mumbai: The Centurion Bank of Punjab (CBoP) is poised to take over the unlisted Kerala based Lord Krishna Bank, subject to Reserve Bank of India's approval.

The deal is said to be pegged at around Rs300 crore, and will be done through a share-swap transaction. Both the bank boards will meet today to decide on the merger.

LKB promoter Mohan Puri, who controls a 65 pc equity stake in the bank, has been under pressure from the RBI to reduce his holding. According to sources, Puri will be offered a little below 6 pc in the merged entity. For CBoP, the merger will help strengthen presence in the southern states.

Rana Talwar, former head of Stanchart Bank and current head of Sabre Capital is said to be the catalyst behind the deal. Talwar who is a majority shareholder in the London-based fund Sabre Capital, had first acquired Centurion, which later took over Bank of Punjab, to form CBoP.

The Burmans of Dabur who currently hold 5 per cent stake in LKB, will hold around 0.5 per cent after the merger. Bank Muscat, which has 22 per cent stake in CBoP, will hold slightly over 20 per cent and the Keppel group of Singapore, which has a 9.4 per cent holding through Kephinance Investment (Mauritius), will end up with about 8.5 per cent.

The merger will lower the foreign shareholding of CBoP - currently below 73 per cent (FDI: 35.52 per cent, FII: 20.84 per cent and GDR: 16.37) - to 65 per cent. This will give FIIs some headroom to buy the stock. On Friday, the scrip closed at Rs23.4, up 1.52 per cent.

LKB has 112 branches and has a strong branch presence in South, particularly in Kerala, where it has 65 branches. CBoP, with 249 branches, has a strong presence in the West and North. The merged entity will have a network of over 400 offices.

Incidentally, rating agency Care on Friday downgraded the tier-II bond issue of LKB from Care A- to Care BBB+ due to a "delay in the expected infusion of capital and consequent constraints on growth".
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IndusInd Bank scouts for partner: to offload 5 pc stake
Bangalore: IndusInd Bank is looking to enter into a strategic tie-up with a foreign bank. It is planning to offload up to 5 per cent in the bank to the strategic investor.

London-based NRIs - the Hindujas -own 31.3 per cent stake in IndusInd Bank. An additional 13 per cent is held through Ashok Leyland, part of the Hinduja Group.
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ICICI Bank raises $340 mn from Tier-I hybrid bonds overseas
Mumbai: ICICI Bank has raised $ 340 million from Tier-I hybrid bonds in overseas markets.

The 10-year perpetual non-cumulative subordinated debt securities, carrying a coupon rate of 7.25 pc received orders worth $3.60 billion.

The bank said 37 pc of the securities were sold into the US market, 30 pc in Asia and 33 pc in Europe.

The 10-year paper will be listed on the Singapore Stock Exchange.

The securities carry a coupon rate of 7.25 pc and have been priced at a spread of 194 basis points over LIBOR. The offering was lead-managed by J P Morgan, Merrill Lynch International and Morgan Stanley.

ICICI Bank is India's largest private sector bank and the second largest bank in the country overall with assets of Rs2,662.65 billion as on June 30, 2006.
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State Bank of India hikes deposit rates
Mumbai: State Bank of India has hiked interest rates on deposits by up to 50 basis points on various maturities from Saturday. Most Indian banks have raised deposit rates recently to attract funds after the central bank in July raised short-term rates by 25 basis points to tame inflation.
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Forex reserves fall by $700 m
Mumbai: According to the Reserve Bank of India's Weekly Statistical Supplement, foreign exchange reserves fell by $701 million to touch $165.094 billion for the week ended August 11. In the previous week, the reserves had increased by $1.772 billion to $165.795 billion.

Foreign currency assets decreased by $696 million to touch $157.769 billion during the week. Foreign currency assets, expressed in dollar terms, include the effect of appreciation or depreciation of non-US currencies such as euro, sterling and yen.
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