Rupee flat
Mumbai: The rupee remained almost unchanged at the close on Tuesday at 40.85/86 against the previous close of 40.87.

The rupee opened at 40.87, which was also the intra-day low and saw an intra-day high of 40.70/72.

Market participants expect the rupee to trade in the range of 40.70 - 41.10.

In forwards, the six-month premia closed at 5.30 per cent (5.61 per cent) and the 12-month ended at 4.50 per cent (4.71 per cent).

Bonds: Bond prices rose by around 25 paise on good liquidity in the system. Total traded volumes on the order matching system were Rs2,515 crore (Rs900 crore).

Dealers said two auctions worth Rs12,000 crore were scheduled this week after which the excess liquidity will be drained from the system.

G-secs: The 8.07 per cent-10 year-2017 paper opened at Rs99.52 (8.14 per cent YTM) and closed at Rs99.77 (8.10 per cent YTM), against the previous close of Rs99.48 (8.14 per cent YTM). The 7.38 per cent - 8 year-2015 paper opened at Rs95.47 (8.14 per cent) and ended at Rs95.62 (8.11 per cent YTM).

Call rates: Call closed lower at 4.50 - 4.75 per cent on Tuesday against the previous close of 6.25 - 6.50 per cent.

Reverse repo: In the first one-day reverse repo auction, the RBI received 17 bids for Rs 17,260 crore while it accepted Rs1,998 crore. There was no repo bid in the first one - day auction. In the second one - day reverse repo auction, it received 11 bids for Rs11,335 crore while it accepted Rs1,002 crore. In the first one - day repo auction, the RBI received and accepted one bid for Rs 30 crore.

The CBLO market saw 442 trades aggregating Rs21,110.90 crore in the 2.03 - 5.25 per cent range.
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Syndicate Bank's FY 2006-07 net up 33 per cent
Bangalore: Syndicate Bank has reported a 33.5 per cent increase in net profit for the financial year 2006-07 at Rs716 crore.

The bank's board has recommended a final dividend of 13 per cent for the financial year 2006-07 taking the total dividend for the year to 28 per cent inclusive of the interim dividend of 15 per cent.

The bank's profits were on the back of a 40 per cent increase in advances which were at Rs52,839 crore against Rs37,660 crore the previous year. The increase in advances with the rise in yield on assets by 56 basis points over FY06 helped the bank report a top line of Rs6,659 crore against Rs4,612 crore. Interest income, as a result, rose to Rs6,040 crore (Rs4,050 crore).

The bank's deposit mobilisation also increased to Rs78,634 crore, a 46.64 per cent increase over the previous year. This translated into an average interest cost of just about 4.94 per cent. This was largely on account of its large pool of low cost deposits. In the financial year 2006-07 alone, Syndicate bank had opened about two million low accounts.
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Kotak Mahindra Bank Q4 net rises by 7.5 pc to Rs37-cr
Mumbai: Kotak Mahindra Bank's net profit increased by about 7.5 per cent to Rs37.3 crore in the fourth quarter ended March 31, 2007, from Rs34.7 crore in the corresponding year-ago quarter. The profit growth would have been higher but for higher provisions amounting to Rs31.7 crore in the fourth quarter. Operating profit was more than 50 per cent higher at Rs 95.9 crore (Rs62 crore).

The net interest income increased to Rs204.7 crore (Rs116.9 crore) while other income rose to Rs87.5 crore (Rs76.5 crore).

Net interest margin for the quarter was around 4.5 per cent. Total income increased to Rs521.07 crore (Rs293.45 crore).

For the fiscal ended March 2007, net profit for the year was up 20 per cent to Rs141.4 crore (Rs118.2 crore).

The bank's board has recommended a dividend of 7 per cent for 2006-07. Operating profit amounted to Rs326 crore (Rs211 crore), registering a 55 per cent growth. Net interest income for the year amounted to Rs 654.9 crore (Rs380 crore). The total advances of the bank grew by 72 per cent to Rs10,924.0 crore as on March 31, 2007 from Rs6,348.5 crore as on March 31, 2006.
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Canara Bank eyes Dena Bank
Mumbai: Canara Bank, the country's third largest bank, is looking at the possibility of acquiring Dena Bank and has appointed Ernst & Young to work out a deal. The chairmen of both the banks are expected to meet shortly, after which the matter would be taken up by the respective boards and employees would be consulted.

Canara Bank has a network of 2,542 branches and is strong in the south while Mumbai-based Dena Bank, with its 1,050 branches, has a large presence in Maharashtra, Gujarat and Chhattisgarh. It overtook Punjab National Bank in 2005-06 to become the country's second-largest public sector bank in terms of advances and deposits.

The government holds 73 per cent stake in Canara Bank and 52 per cent in Dena Bank-it holds a little over the statutory cap of 51 per cent in the latter, which restricts the bank from raising further capital by diluting its stake.

The merger will help Dena Bank, which has just come out of a huge burden of sticky loans or non-performing assets (NPAs). Though it is now better off financially, it has a limited capital base to grow business at the rates that the banking sector has seen in the last three years.
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LIC Housing floats FD scheme
Mumbai: LIC Housing Finance has for the first time launched a fixed deposit product to raise Rs1,000 crore this fiscal. The scheme will offer an interest of 9 per cent per annum on a three-year deposit and 9.25 per cent per annum on a five-year deposit. The minimum deposit is Rs10,000 with multiples of Rs1,000 thereafter.

For the cost of funds has been rising and was 10.5 per cent in 2006-07.

Officials said as 85 per cent of customers are on floating interest rate loans, the organisation can pass on the interest rate hikes but is looking at a better way of containing fund costs. It is seeking to diversify its sources of funds and de-risk borrowings by tapping the retail depositors.

The FD scheme has been rated FAAA- stable by CRISIL.
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ICICI to dilute equity: seeks shareholders nod for issuing shares
Mumbai: India's largest private lender ICICI bank will seek shareholders approval for issuing shares of up to 25 per cent stake in the bank and for reducing the authorised share capital to Rs1,775 crore from Rs1,900 crore.

The bank said the authorised capital will be changed to Rs1775 crore, divided into 127.50 crore equity shares of Rs10 each, 150 lakh preference shares of Rs100 each and 350 preference shares of Rs one crore each.

The company would also seek shareholders approval through postal ballot for issuing up to 25 per cent of the authorised share capital by way of preferential allotment, private placement, it added.
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StanChart introduces one-stop e-channel
Mumbai: Standard Chartered Bank has launched its one-stop proprietary electronic banking channel for corporate and institutional clients - Straight2Bank.

The bank said it has made significant investment in its electronic platform in response to clients' need for a truly integerated channel that allows clients to process transactions, hedge foreign currency exposures, and access information through a single interface. Straight2Bank has been designed so that it provides the users process efficiency.
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Kamal Nath seeks PM's intervention on rising rupee
New Delhi: The Commerce and Industry Minister, Kamal Nath, has sought the intervention of Prime Minister, Dr Manmohan Singh, on the issue of the rising rupee vis-à-vis the US dollar, particularly to address the concerns of the exporting community.
Official sources said that the Prime Minister had been requested to convene a meeting of all agencies concerned to discuss the matter and take appropriate action.

The FIEO President, G.K. Gupta, said that the continuous appreciation of the rupee was exerting pressure on profit margins of exporters and urged the Government to intervene in the larger interest of exporters so that they are able to maintain their competitive edge in the global market and also achieve the target set by the Government. The Government has set an export target of $160 billion for 2007-08 and $200 billion for 2008-09.

Gupta added that the increase in raw material cost and interest rates had compounded the exporters' woes.
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RBI bans NBFCs lending to directors, relatives
Mumbai: Non-banking financial companies (NBFCs) have been banned from extending loans to its directors and their relatives to eliminate any conflict of interest in the lending operations of the finance companies by the Reserve Bank of India.

The NBFCs with deposit size of Rs20 crore or more and non-deposit taking NBFCs with assets of Rs100 crore and above also cannot provide any non-fund based facility or any other financial accommodation to firms in which directors hold interest as partner or guarantor.

In case of loans extended to directors without any repayment date, the RBI directed the NBFCs to recover them within one year and in other cases, the NBFCs will be required to recover the loan with interest as soon as it falls due for repayment.

The RBI also asked the NBFCs to submit a quarterly statement about the loans and advances granted to their directors, relatives and other entities within 15 days from the close of the quarter.
The deposit taking NBFCs are also required to establish audit committees with minimum three board members.

Till now this applied only to NBFCs having assets of Rs50 crore and above.
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