Rupee gains
Mumbai: The rupee gained against the dollar and opened at 44.58/60 to close the day at 44.45, up from Friday's 44.56/57.

In forwards, the 6-month closed at 4.67 per cent (3.69 per cent) and the 12-month ended at 3.64 per cent (3 per cent).

Bonds: Bond prices dropped by 21 paise (yields rose by almost four basis points) on tight liquidity. Traded volumes on the order matching system were Rs1,150 crore (Rs1,390 crore).

G-secs: The 7.59 per cent-10 year-2016 paper opened at Rs99.75 (7.63 per cent YTM) and closed at Rs99.74 (7.63 per cent) against Friday's Rs99.95 (7.59 per cent YTM).

The 8.07 per cent-11 year-2017 paper opened at Rs103.25 (7.60 per cent YTM) and closed at Rs103.15 (7.62 per cent YTM) against Friday's close at Rs103.35 (7.59 per cent YTM).

Call rates: Call rates soared to a six-year high of 11.5 per cent on tight liquidity.

Reverse repo: In the first one-day reverse-repo auction under LAF, RBI did not receive any bid and in the first one-day repo auction, the RBI received and accepted 39 bids for Rs23,245 crore. In the second one-day reverse-repo auction, the RBI accepted and received five bids for Rs285 crore and in the second one-day repo auction, the RBI received and accepted 17 bids for Rs5,035 crore.

CBLO: The CBLO market saw 362 trades aggregating to Rs16,158.15 crore in the 7.2-10.2 per cent range.
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State Bank hikes PLR by 50 bps to 11.5 pc
Mumbai: State Bank of India (SBI) has hiked its prime lending rate (PLR) to 115 pc with effect from today.

This is the third increase in SBI's benchmark rate since May 2006.
The immediate triggers for the upward revision in lending rates by SBI are a 25-75 basis points increase in interest rates on term deposits and the Reserve Bank of India's (RBI) further monetary tightening earlier this month.

The RBI raised the cash reserve ratio (CRR) by 50 basis points to 5.5 per cent from January 6 amid fears of overheating in the fast expanding economy.

The cost of funds have gone up due to an increase in deposit rates, plus the hike in CRR means the bank will have to keep higher balances with the central bank, which do not earn any interest.

All other public sector banks are expected to follow SBI in raising their lending rates.
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HSBC has more than 20 lakh credit card holders
Mumbai: HSBC India's credit card division has said it has crossed the 20 lakh credit card mark with the last 500,000 cards being subscribed in the last five months.
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Banks react against RBI's draft on derivatives
Mumbai: Banks have hit out against the Reserve Bank of India's (RBI) draft proposals on derivatives trading saying there is no need for the RBI to, "dictate the nature of products and tenure of deals." They are also against a proposal that says that long-term exposure in a swap could mean residual maturity of three years or more. They said this would be a deterrent in providing derivatives products to small and medium sized corporates.

Most of the banks, especially foreign, may have to review their derivatives books following the new guidelines as the RBI proposes to cap their derivatives exposures, measured in terms of present value of the deal, within 0.25 per cent of their net worth.

Banks are also opposing the minimum residual maturity of three years in a swap deal as majority of the clients are SMEs and most do not have a "good" rating. Banks feel it would be difficult for them to maintain an exposure on such entities for a period of three years.

Banks are also irked by the proposal of the RBI that holds them responsible for compelling corporates to disclose their derivatives positions in association with the Institute of Chartered Accountants and others.
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Allahabad Bank to expand retail credit portfolio
Kolkata: Allahabad Bank is planning to increase its retail credit portfolio and will organise retail credit camps at strategic locations in the city, according to a press release from the bank. The bank has come out with a bouquet of retail credit products such as car loans, loans against rent receivables, loans against property, saral loans, loans for purchase of jewellery, housing loans and education loans.
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