Rupee declines marginally
Mumbai: The rupee declined by about two paise as the RBI reportedly bought dollars. The rupee opened strong at 44.06, and stayed at 44.07 for around three hours to finally close at 44.13/14, against Thursday's close of 44.11/12.

Dealers said the rupee is expected to weaken next week on month-end demand from importers. The six-month forward premia closed at 3.36 per cent (3.71 per cent) and the one-year at 3.11 per cent (3.36 per cent).

Bonds: Bond prices remained unchanged. Total traded volumes on the order matching system were Rs2,545 crore (Rs2,975 crore). News that government stocks issued in lieu of nationalised banks' recapitalisation bonds would count as SLR instruments, as eligible investment for statutory liquidity ratio did not dampen spirits.

G-secs: The 8.07 per cent-10 year-2017 paper opened at Rs100 (8.07 per cent YTM) and closed at Rs100.37 (8.01 per cent YTM), against the previous close at Rs100.35 (8.02 per cent YTM).

The 7.37 per cent - 7 year-2014 opened at Rs96.10 (8.09 per cent YTM) and closed at Rs96.45 (8.03 per cent YTM), against the previous close at Rs96.50 (8.01 per cent).

Call rates: Call rates rose to 7.90-8.10 per cent today against the previous close of 6.25-6.50 per cent due to the first phase of the CRR hike beginning on Feb.17.

Reverse repo: In the first one-day reverse repo auction, RBI received and accepted two bids for Rs30 crore while in the first one-day repo auction, RBI received and accepted fourteen bids for Rs4,435 crore.

In the second one-day reverse repo auction, the RBI received and accepted three bids for Rs55 crore and in the second one-day repo auction, it received and accepted eleven bids for Rs4,360 crore.

CBLO: The CBLO market saw 367 trades aggregating to Rs23,151.30 crore in the 7.41 - 7.65 per cent range.
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SBI hikes PLR by 75 bps
Mumbai: State Bank of India has raised its benchmark prime-lending rate (SBAR) by 75 basis points to 12.25 per cent per annum, effective February 20. The hike follows the increase in cash reserve ratio by the RBI to 6 per cent. However, SBI said it will touch the existing home loans under the priority sector by the interest rate hike.

SBI said that all existing housing loans under priority sector, existing educational loans, existing and future agricultural production loans less than Rs3 lakh and new educational loans up to Rs 4 lakh sectors will be excluded from the impact of the above change in SBAR by appropriate adjustment of spreads above or below SBAR wherever applicable.
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IFFCO-Tokio in pact with Peerless
New Delhi: Japanese insurance company IFFCO-Tokio General Insurance has entered into a tie-up with the Peerless Group to offer retail and commercial line of insurance products through the latter's distribution network. This tie-up will be rolled out in three phases. The first quarter of the year will witness the launch in West Bengal and Orissa.
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RBI targets money transfer sub-agents over KYC
Mumbai: Reserve Bank of India has now turned it scanner on money transfer sub agents over the know-your-client norms. These could be local shopkeepers or paanwallahs across the road.

Last week, RBI sent across a circular to big players involved in the money transfer business, including principal agents asking them to submit a detailed note on the due diligence being conducted, while appointing sub-agents.

Currently, apart from appointing direct agents such as banks, post offices, retail outlets etc., money-transfer companies also appoint small-time shopkeepers, traders etc., as sub-agents, who can transact business on behalf of the company.

An RBI officials said there should be someone entrusted with the onus of checking the credentials of small-time players and hence RBI is looking at evolving a policy wherein companies will be asked to perform certain checks on sub-agents' credentials and then they will have to revert to RBI for feedback.

Before this, RBI had sent out another circular in the first week of February, which advised players against appointing players other than authorised dealers falling within categories I and II, scheduled commercial banks, full-fledged money changers and the postal department as sub-agents.
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