Rupee strengthens
Mumbai: The rupee gained against the US dollar on Wednesday by about 8 paise after falling for two days. It gained as dealers unwound long positions. The rupee's movement will be clearer tomorrow," said a forex dealer.

The rupee opened at 45.84 and closed at 45.65 against the previous close of 45.72/73. The dollar did not see much movement against other currencies.

Forwards: Forward premia went up slightly. The 6-month closed at 1.44 per cent (1.36 per cent), and the 12-month ended at 1.42 per cent (1.37 per cent).

Bonds: Bonds fell by about eight paise as investors sold to invest in fresh auctions.

G-secs: The 7.59 per cent 10-year 2016 benchmark paper opened at Rs99.79 (7.62 per cent YTM) and closed at Rs99.74 (7.63 per cent YTM). The 9.39 per cent five-year 2011 paper opened at Rs107.60 (7.44 per cent YTM) and closed at Rs107.64 (7.43 per cent YTM) against Tuesday's Rs107.72 (7.42 per cent YTM).

Call rates: Call rates were between 6.40-6.50 against Tuesday's 6.35 and 6.45 per cent. Reverse repo: In the first one-day reverse repo auction under LAF, the Reserve Bank of India received and accepted six bids amounting to Rs14,300 crore and in the second one-day reverse repo auction, 13 bids for Rs11,310 crore.

CBLO: The CBLO market saw 312 trades aggregating to Rs18,155.15 crore in the 6.04-6.35 per cent range.
Back to News Review index page  

Barclays acquires 4.7 pc stake in IDFC
UK based Barclays Bank Plc has acquired a 4.7 pc equity stake in Infrastructure Development Finance Company. The equity stake was acquired through Barclays Capital Mauritius, a registered foreign institutional investor, via secondary market purchases and is in the nature of an investment. The total amount invested was approximately Rs3.80 billion.

The bank said its stake in IDFC underlines its interest in the fast growing infrastructure sector in India. On March 31, 2006, Barclays announced a USD 150 million investment to support its expansion in Indian investment banking, and a further USD 70 million for its corporate and commercial banking business. This transaction forms part of Barclay`s ongoing investment and development of its business in India.
Back to News Review index page  

HSBC offers new money transfer scheme
Dubai: HSBC has launched the 'One World' new money transfer service for Indians living in the Gulf. The money transfer scheme will allow Indians to open bank accounts in the UAE even before they arrive here, to transfer their credit history from India as well as help with their credit card and mortgages. Indians living in the UAE can also transfer money to their HSBC accounts in India free of charge using cheques or the Internet and onwards to come 1,000 branches of other Indian banks that are linked electronically.
Back to News Review index page  

BoM to raise Rs300-cr through bonds
Mumbai: Bank of Maharashtra (BoM) plans to raise up to Rs 300 crore through a bonds issue during October 12-13 to meet the capital adequacy requirement. The upper tier II bonds with a maturity period of 15 years will be issued at a coupon rate of 9.10 per cent per annum. The bank will pay 9.6 per cent interest per annum from 10th year onward if the call option is not exercised. The deemed date of allotment of bonds is October 14 it said.
Back to News Review index page  

SBI plans commercial branch in Bahrain
Dubai: The State Bank of India (SBI) will open a first commercial branch in Bahrain next month. The bank had set up its first office in Bahrain 30 years ago and earlier upgraded its status to the headquarters of its Middle East, West Asia and North Africa operations. SBI is investing $3 million to develop the new branch, which would also include an on-site ATM which would be connected to its other ATMs in the Gulf region and to about 7,000 ATMs in India. Officials said the bank would finance development projects in Bahrain.
Back to News Review index page  

PNB achieves biz of Rs2,13,000-cr in H1
New Delhi: Punjab National Bank (PNB) has achieved a business of Rs2,13,000 crore in the first half of this fiscal and expects to surpass the goal of deposits and advances set for the year end-March 2007.

The bank will open its second large corporate branch (LCB) in Delhi tomorrow - making it the eighth after one each in Mumbai, Ahmedabad, Bangalore, Kolkata, Chennai and Ludhiana and Delhi - as the concept has gained popularity among corporates. Deposits of the bank stood at Rs1,29,000 crore while advances were at Rs84,000 crore till September this year. The bank had set a business target of Rs 2,25,000 crore for 2006-07.
Back to News Review index page  

Union Bank to raise Rs1,400-cr
Mumbai: The Union Bank of India plans to mobilise Rs 1,400 crore capital funds through issuance of bonds over the next five months. This week the public sector bank also raised Rs300 crore of perpetual debt.

Union Bank has drawn up a massive capital-raising plan to maintain its capital adequacy ratio (CAR) substantially above the mandatory 9 per cent even after implementing the Basel-II capital adequacy norms.

The bank requires capital funds not only to support credit growth but also to provide nearly Rs 500 crore for operational risks under the new capital adequacy norms. Basel-II requires banks to provide capital for operational risks in addition to credit and market risks.

Union Bank's CAR at the end of September is likely to have fallen below 11 per cent from 11.4 per cent at the end of March this year. Its tier-I capital adequacy on March 31 was 7.32 per cent.

Basel-II norms are expected to reduce the banking sector's CAR by 2 percentage points from the average CAR of over 12 per cent.

The bank raised the Rs300 crore through its maiden perpetual debt issue at a coupon rate of 9.45 per cent for the first 10 years and 9.95 per cent for all subsequent years.

Union Bank also needs resources to fund credit growth. The bank no longer has room to further liquidate its statutory liquidity ratio (SLR) investments to fund credit as the SLR ratio has fallen to 25.2 per cent, which is just above the statutory minimum of 25 per cent.

Union Bank's plans are to raise Rs1,000 crore through upper tier-II bonds, Rs300 crore through perpetual bonds, which qualify as tier-I capital, and Rs400 crore through subordinated bonds. Crisil has assigned AA+stable rating to these issues.

The rating agency said it expected large absolute accretion to Union Bank's net worth through retained net profits in order to enable the bank to maintain its overall capital adequacy at comfortable level over the medium term.
Back to News Review index page