Rupee gains
Mumbai: The rupee gained almost 25 paise on dollar selling by companies. The rupee opened at 41.04/05 and finally closed at 40.85/87 against the previous close of 41.10 on Thursday.

The six-month forward premia is at 5.61 per cent (5.96 per cent) and 12-month premia is at 4.71 per cent (4.82 per cent).

Bonds: Bond prices fell by around 5 paise at the close of day in anticipation of inflation data and auction-announcements.
Domestic inflation in the week-ended April 21 was 5.77 per cent against 6.09 per cent in the previous week, in line with dealer expectations.

The RBI announced Market Stabilisation Scheme (MSS) auctions for Rs 2,000 crore on May 9 and Rs10,000-crore government securities auction on May 11.

G-secs: The 8.07 per cent- 10 year-2017 benchmark paper opened at Rs99.40 (8.16 per cent YTM) and closed at Rs99.39 (8.15 per cent YTM), against the previous close at Rs99.46 (8.15 per cent YTM). The 8.33 per cent-29 year-2036 paper opened at Rs98.15 (8.50 per cent) and closed at Rs97.89 (8.52 per cent YTM).

Call rates: Call closed lower at 7.25 - 7.50 per cent on Friday against the previous close of 8.25 - 8.50 per cent.

Reverse repo: The RBI lent to banks Rs1,945 crore through the repo window while banks parked Rs1,130 crore under the reverse repo with the central bank.

In the first three-day reverse repo auction, the RBI received and accepted two bids for Rs915 crore. In the first three - day repo auction, it received and accepted three bids for Rs1,720 crore. In the second three - day reverse repo auction, it received and accepted three bids for Rs215 crore. In the second three - day repo auction, it received and accepted three bids for Rs 225 crore.

CBLO: The CBLO market saw 408 trades aggregating Rs18,300.70 crore in the 2 - 7.35 per cent range.
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City Union in pref issue to 6 investors
Mumbai: City Union Bank plans to make preferential issues to six investors subject to approval from its shareholders and the Reserve Bank of India. The proposed investors include domestic players such as LIC, Larsen and Toubro and Yatish Trading, a promoter-group company of Brics Securities. Besides this, the bank has also made a preferential allotment to a Mauritius-based venture capital firm called Ares Investments and to a US-based FII called Argonaut Ventures.

FMO, a Netherlands-based DFI has also been offered an equity stake. The preferential issue would infuse capital worth up to Rs 120 crore into the bank, helping it achieve a net worth of Rs 400 crore.

Last year, L&T had offered to pick up a 9.99 per cent stake in City Union Bank. RBI allowed L&T to pick up an equity stake of 4.73 per cent as regulations do not allow a domestic corporate to own more than 10 per cent ownership in a private bank.

Even after the preferential allotment, L&T would own less than 5 per cent stake in the bank. The bank has offered upto 15 lakh shares to LIC and 3 lakh shares to L&T at a price of Rs 169.15.

The total paid-up capital of the bank has risen to Rs32 crore, from Rs25.2 crore. As on March 31, 2007, the bank had a net worth of Rs286 crore. L&T made an investment of Rs20 crore, picking up a 4.73 per cent stake, earlier this year. The bank's capital adequacy ratio, which was around 12 per cent a year ago, could now rise to 13.5 per cent, following these investments.
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Forex reserves rise $254mn to $204.14bn
Mumbai: Foreign exchange reserves increased $254 million to $204.135 billion for the week ended April 27, according to Reserve Bank of India data.

While foreign currency assets increased $245 million to $196.877 billion, SDRs moved up $9 million to $11 million.

Gold reserves and the Reserve Position in the IMF were steady at $6.784 billion and $463 million, respectively.
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GE Money to exit two-wheeler financing
Mumbai: GE Money, the consumer finance arm of General Electric, has decided to get out of the two-wheeler finance business due to low margins, and said it would now focus on the high growth and high profitability segments of its business.

Other players in the two wheeler finance business are ICICI Bank, HDFC Bank, CitiFinancial and Centurion Bank. GE Money is also a small player in the business and has a retail distribution network in over 5,500 outlets across 70 locations. It also provides car finance, consumer durable finance, personal loans and loan against property and home loan.

According to industry information service CRIS INFAC, an arm of credit rating agency CRISIL, the outstanding portfolio of the two-wheeler finance market is expected to reach Rs30,800 crore by 2009-10 from about Rs18,100 crore now.
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RBI decides not to levy charge on paper based transactions
Mumbai: The Reserve Bank of India has decided to reject its own study group's recommendation to charge paper-based transactions. The Study Group on Migration from Paper Based Funds Movement to Electronic Funds Transfer had recommended a charge on paper-based transactions to be borne by the bank customers in a bid to shift to electronic funds transfer. This is the third time that the Reserve Bank has rejected such a suggestion. The RBI has also clarified that the recommendations of any study group - internal or external - constituted by the RBI, are purely recommendations and do not reflect the views of the RBI.
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PNB ups interest rates on home loans above Rs20 lakh
New Delhi: Punjab National Bank has increased interest rates on home loans above Rs20 lakh by 100 basis points. The total home loan portfolio of the bank was about Rs7,000 crore as on March 31.
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