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Rupee range bound
Mumbai:
The rupee was under pressure due to dollar demand, due to gold buying though dealers said the rupee is not expected to weaken. The rupee opened at 46.14/15 due to a weaker yen, and touched a low of 46.17 before ending trade at 46.14/1450, slightly lower than Friday's close of 46.12.

Forwards: The six-month premium closed at 1.36 per cent (1.3 per cent) and the one-year closed at 1.34 (1.3 per cent).
Bond: Bond prices rose by around 30 paisa on expectations of a pause in interest rate hike cycle in the US.

G-secs: The 7.59 per cent-10 year-2016 paper opened at Rs98.4 (7.83 per cent YTM) and closed at Rs98.74 (7.778 per cent YTM), higher than Friday's close at Rs98.42 (7.83 per cent YTM). The 8.07 per cent-11 year-2017 paper opened at Rs101.25 (7.88 per cent YTM) and ended at Rs101.72 (7.82 per cent YTM), higher than Friday's close at Rs101.36 (7.87 YTM).

Call rates: Call rates were between 6.25 per cent and 6.35 per cent against Friday's 6.10-6.20 per cent.

Reverse repo: In the first one-day reverse repo auction under LAF, Reserve Bank of India received and accepted six bids amounting to Rs1,140 crore and in the second one-day reverse repo auction, seven bids for Rs2, 485 crore.

CBLO: The CBLO market saw 345 trades aggregating to Rs19,970.60 crore in the 6.05-6.35 per cent range.
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BoB applies for life insurance foray
Mumbai:
Bank of Baroda (BoB) is applying for regulatory approvals for foraying into life insurance business through a joint venture route as the board of the public sector bank has already given its approval for setting up of the life insurance joint venture.
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Sundaram Finance raises interest rates
Chennai:
Financial services company Sundaram Finance has increased the interest rates on fixed deposits by 0.5 per cent. Deposits for a period of 1-2 years would now yield 8 per cent interest and those above three years 8.50 per cent, a company statement said. The revised rates are effective from September 1, it said.
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Lakshmi Vilas Bank to come out with rights issue
Mumbai:
Tamil Nadu-based Lakshmi Vilas Bank (LVB) plans to raise Rs98.36 crore through a rights issue to take its networth beyond the minimum Rs300 crore prescribed by the Reserve Bank of India (RBI).

The private sector bank will issue 1.96 crore equity shares of Rs 10 each to existing shareholders at a premium of Rs 40 per share. The ratio of rights shares in 1:1.

LVB's networth after the rights issue will increase to Rs389.41 crore from Rs 291.04 crore now and Rs229.99 crore at the end of March 2006.

The bank is also issuing bonus shares in the ratio of one bonus share for the two existing shares. However, the bonus shares are not entitled for the rights share.

The bank's capital adequacy ratio as on March 31, 2006 was 10.79%, as against the RBI stipulation of 9%. The shares of LVB today closed 8.88% up at Rs121.35 per share on the National Stock Exchange. The book value of LVB shares is Rs149 per share.
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BoM enters retail banking
Pune:
Bank of Maharashtra (BoM) has forayed into the booming retail banking business and has created a separate retail credit department headed by a senior banking official Vinod N Dalvi, as general manager in-charge of retail credit.

The bank plans to increase the share of retail credit to 21 pc of total advances by end-FY07 from 13 pc at end-March 2006. BoM's total advances as on March 31, 2006 stood at Rs16,469.72 crore.

BoM has already started distributing life insurance policies of Life Insurance Corporation of India (LIC) and general insurance products of United India Insurance Company.

The bank is also making efforts to increase focus on fee-based services and as part of the plan, would soon start selling mutual fund products. The bank is in talks with 'three leading mutual funds' for distribution of their products, M D Mallya, chairman of the bank, said.

The bank is on course to implement core banking solution and 100 key branches will be brought in the ambit of CBS by end-FY07, Mallya said.
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Union Bank signs pact with DGFT
Kochi:
Union Bank of India has entered into an agreement with the Director General of Foreign Trade (DGFT) and has been provided with an electronic payment facility by the latter for payment of application fees for licensing schemes.

The bank's clients can make online payment of fees to DGFT, view successful payment immediately and take printouts for their record.

In case the transaction is not successful, refund will also be online into the customers' bank account.

Union Bank is one of the few banks offering e-payment facility for licence fees, a release from the bank said.

The bank is also implementing Reuters' leading edge pricing engine technology. For this, the bank is offering Reuters Trading for Foreign Exchange (RTFX) and Reuters Trading for Bullion (RTFB). Participating in RTFX and RTFB trading platform in conjunction with the deployment of electronic trading pricing engine would empower the export/import customer to have a platform for hedging and trading in foreign currency. Union Bank says it is the first among public sector banks to become a market maker for RTFX and RTFB.
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domain-B : Indian business : News Review : 19 September 2006 : banking and finance