Re moves up against dollar
Mumbai: The rupee gained against the dollar due to some foreign banks selling the dollar, leading to depreciation in the value of the US currency. The rupee opened at 46.57, but recovered to close at 46.50/51, higher than Friday's close at 46.57. The rupee is expected to weaken in the coming days due to the month end demand for dollars from importers.

In the forward-premia market, the six-month premium ended at 1.36 per cent (1.31 per cent) and the 12-month premium at 1.32 per cent (1.29 per cent).

Bonds: The bond market was volatile with the price of the benchmark 10-year paper moving in a band of 30 paise. There was also a sell off on talks that oil bonds may be given the status of Statutory Liquidity Requirement securities. It was also being said that the government may allow conversion of recapitalisation bonds into SLR bonds, said dealers. The fear is that this will lead to an increase in the supply of bonds with a corresponding drop in demand for government securities from banks said dealers.

G-secs: The 7.59 per cent-10 year-2016 paper opened at Rs97.65 (7.94 per cent YTM) to touch a high of Rs97.78 in day trade. It then fell to Rs97.47 before closing at Rs97.6 (7.95 per cent YTM), a tad higher than Friday's close of Rs97.50 (7.97 per cent YTM). The 8.07 per cent-11-year 2017 paper opened at Rs100.75 (7.96 per cent YTM), dropped to Rs100.36 before ending at Rs100.49 (7.8 per cent YTM), higher than Friday's close of Rs100.46 (8 per cent YTM).

Call rates: Call rates remained unchanged between 6.00 and 6.10 per cent.

Reverse repo: In the first one-day reverse repo auction under the LAF, the Reserve Bank of India received and accepted 21 bids amounting to Rs23,555 crore and in the second one-day reverse repo auction, 28 bids for Rs15,650 crore. There were no repo bids.

CBLO: The CBLO market saw 265 trades aggregating to Rs15,836.60 crore in the 5.70-6.03 per cent range.
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ICICI Bank in tie up with Mitsubishi UFJ
Mumbai: The country's largest private bank, ICICI Bank has entered into a non-exclusive memorandum of understanding (MoU), with Mitsubishi UFJ Securities Co, a unit of Japan's biggest bank by assets. As per the agreement both the firms will explore possibility of providing reciprocal support for their respective customers in merger and acquisition and corporate finance areas. The alliance is expected to facilitate the merger and acquisition deals by Japanese companies operating in India. The two entities will focus on developing ties in the areas of corporate finance and mergers and acquisitions. Going ahead, the services would form a part of the investment banking division of the ICICI Bank group.

The alliance does not involve any equity participation in ICICI Bank by Mitsubishi UFJ Securities. The alliance would enable both the firms to pave the way for intensifying cooperation, across various areas, namely merger and acquisition, corporate finance and asset management business.

Under the MoU inked between ICICI Bank and Mitsubishi UFJ Securities, customers expecting potential of business development in the other country, would be able to benefit from a range of cross-border financial services, which will be offered by cooperation of the two companies. Both firms will consider cooperation in the sales of financial products, thus expanding investment product lines for clients.
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RBI works out ways to transfer stake in SBI
New Delhi: The Reserve Bank of India (RBI), which has to transfer to the Government 59.7 per cent stake in State Bank of India, is currently working out ways to achieve this.

Recently the Union cabinet decided to amend the SBI Act to enable the bank to tap the capital market for raising funds. The proposed amendment seeks to empower the bank to issue preference shares and bonus shares. Once the SBI Act is amended the bank will be authorised to increase the number of managing directors and executive directors so that it can discharge its functions more efficiently. At present the bank has one chairman and three managing directors. After the amendment is through, there would be no cap on the number of managing directors. In a bid to give more flexibility to the board of directors and improve corporate governance standards in public sector banks, Parliament recently passed the Banking Companies (Acquisition and Transfer of undertakings) and Financial Institutions Laws (Am endment) Bill.

The Bill includes a number of provisions for giving greater flexibility to the board of directors and improve corporate governance norms in state-run banks and also envisages increasing the number of whole-time directors from two at present to four, besides making the government share transferable.
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NHB to launch reverse mortgage scheme for senior citizens by year-end
New Delhi: The National Housing Bank (NHB) plans to launch a reverse mortgage scheme this year. The scheme targets senior citizens who can receive a secure income from their assets by availing of the scheme.

According to NHB the product would be the first of its kind. NHB intends to support primary lenders such as banks and housing finance institutions (HFIs) to implement the product by providing refinance to primary lenders. It also guarantees the obligation of primary lenders towards senior citizens.

Senior citizens aged 62 or above, opting for reverse mortgages would get a steady income flow for 15 years against their home value.
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UCO Bank completes restructuring
Kolkata: UCO Bank has completed the process of organisational restructuring to expedite the delivery mechanism. A three-tier operational level has been created on the basis of business handled. The retail tier would handle business up to Rs3 crore and mid-corporate and flagship tiers would deal with business between Rs3 crore to Rs50 crore and Rs50 crore onwards respectively, the bank sources said here. The organisational restructuring would not have any impact on the manpower, which the bank currently has on its rolls.

Some 10,000 to 12,000 employees would be rendered surplus in the next five years, however, following implementation of the core banking solution. The bank plans to put 1,000 branches under the CBS platform in the next five years across the country at a total cost of Rs139 crore. The restructuring was based on the recommendations of the Boston Consultancy Group (BCG).
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J&K Bank aims at top slot in commodity financing
Srinagar: Jammu and Kashmir Bank is targeting to become a top commodities financing institution in the next few years to tap the huge potential in the sector. The bank says that once the futures and options (F&O) market develops, it will give excellent returns. The bank may lend about Rs300 crore to Rs400 crore to the commodities sector this fiscal. The bank, in which the government of J&K holds 53 per cent stake, also plans to aggressively lend in the state.

At present about 70 per cent of the bank's lending is outside the state.

J&K chief minister Ghulam Nabi Azad recently urged the bank to lend more to businessmen, entrepreneurs, especially the youth who want to lay their hand on business.

The bank unveiled a new logo on August 25, which comprises three squares coloured green, blue and red representing Jammu, Kashmir and Ladakh respectively.
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BoI JV with Japan-based Dai Ichi cleared
Mumbai: The Bank of India's board of directors has cleared the joint venture proposal with Japan-based Dai Ichi Mutual Life and another Indian partner. It has also approved the floating of upper tier II bonds in the overseas market for Rs9 30.71 crore ($200 million). The board of directors at its meeting held recently, cleared the JV proposal marking the bank's entry into life insurance business, Bank of India informed the Bombay Stock Exchange.

Dai Ichi Mutual Life Insurance is the second largest life insurance company of Japan and the sixth largest in the global life insurance industry by written premium. The board has also approved the floating of upper tier II bonds in the overseas market for Rs930.71 crore ($200 million) with a green shoe option of Rs186.14 crore ($40 million). These bonds would be listed on the Singapore Stock Exchange. The shares o f the bank were trading at Rs136, up 1.12 per cent at the BSE.
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Temasek not allowed to raise stake in ICICI Bank
Mumbai: The Reserve Bank of India has not allowed Singapore's Temasek Holdings Pte. to increase its stake in ICICI Bank on the grounds it will breach a foreign investment limit. India and Singapore signed a free-trade agreement last year which set a 10 percent investment limit for Singapore firms in listed Indian companies. Under central bank rules the normal investment cap for foreign financial institutions or banks in Indian banks is 5 percent. Singapore investment group Temasek [TEM.UL], which is owned by the finance ministry and state investment arm the Government of Singapore Investment Corporation (GIC), can hold up to 10 percent each in Indian listed firms under the free-trade treaty.

ICICI Bank, India's largest private sector bank, says Temasek, through its unit Allamanda Investments, holds a 7.57 percent stake and GIC holds another 1.57 percent. Both Temasek and GIC want to raise their stakes to 10 percent. 'The Reserve Bank of India (RBI) has taken a position that both Temasek and the Government of Singapore Investment Corporation are owned by the Singapore government. The combined stake in the bank would cross the 10 percent limit allowed in a private bank.
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