Public sector banks could see higher pressure on their net interest margins in the coming months as they have mopped up large amounts of deposits at higher rates and have also effected steep cuts in lending rates between November 2008 and January 2009.
When AS-15 became operative in 2006, the initial estimate for additional pension provisioning was estimated at Rs 6,000 crore. However, the latest wage revision may bring in an additional 275,000 bank employees who opted for PF. Banks may also provide for the pension liabilities of 65,000 employees who have retired but have been seeking resort to the defined pension scheme since 1996. This will require additional provisioning of Rs 6,000 crore.
With real estate prices moving southwards, several banks and financial institutions are buying their own properties and shifting from rented and leased premises.
The country's largest life insurer has been inundated with applications from companies, including heavyweights such as Reliance, as the deepening credit crisis forces India Inc to look for new sources of funds. Many companies are issuing NCDs largely to meet their working capital requirements as well as long-term capital expenditure plans.
Standard Chartered CEO-Asia Jaspal Bindra spoke to Anirudh Laskar and Sidhartha about the bank's plans and his assessment of the situation.
While the ministry sources clarified that the overall policy for fax editions is still under review, this proposal has been given approval on a case-to-case basis in FIPB's meeting held last week. The proposal was turned down twice earlier pending the review but the company had applied to FIPB under deferred proposal agenda in its meeting on January 9.
Making cash payments at bank counters to settle your credit card dues is getting expensive. Credit card issuers led by ICICI Bank and HDFC Bank have started levying a fee on such payments.
Official sources said the 2000-01 acquisitions -- notably the high-profile purchase of web portal India World Communications from Rajesh Jain for Rs 499 crore (Rs 4.99 billion) -- by Satyam Infoway could mark the start of the company siphoning funds overseas under the guise of acquiring companies. Satyam Infoway was merged with Satyam Computers in 2002.
But their plea for fresh measures to boost their liquidity has not found favour with the National Housing Bank, which assessed their fund requirement in the last week of December. Sources at NHB said the measures initiated by the Reserve Bank of India appeared sufficient for the requirements.
Banks led by State Bank of India are set to lower deposit rates by over 50 basis points by the middle of the month, followed by a reduction in lending rates.
The government is considering setting up a special purpose vehicle (SPV) for financing of non-banking finance companies (NBFCs) following the reluctance of banks and mutual funds to make available funds for the sector.
While Barclaycard, the card arm of the Barclays group, has informed some of the credit card holders that the cash limit has been reduced to zero 'to help manage the credit situation'. The new entrant to the cards business in India has sent text messages to card holders informing them about the change. A customer care executive said that the limit has been lowered for all card holders.
At the start of 2008, Manoj Singh headed Tranzact Consolidated India, among the largest direct sales agents in Mumbai with about 200 employees.
The Department of Industrial Policy and Promotion in the Commerce Ministry proposes to scale back the Foreign Direct Investment ceiling for the tobacco industry from 100 to 74 per cent and insert a caveat that cigarettes manufactured in the new ventures or in upgraded facilities must be mainly for consumption outside India.Sources said the department, which is responsible for the policy on FDI, is finalising a cabinet note aimed at comprehensive review of the tobacco policy.
Sending money overseas instantly could soon become a reality with the Reserve Bank of India considering proposals to allow non-banking entities like online money transfer portals to undertake wire transfers for outward remittances from India.At the moment the facility is limited to inward remittances, while only banks are permitted to carry out outward remittance orders.
Unlikely to launch formal probe into IT firm's Maytas move.
The Reserve Bank of India has started a review of the non-performing asset or bad loan classification norms to ease the flow of credit to corporate groups.The move follows a reference from the government and is aimed at relaxing the norms temporarily to enable companies to access funds during the economic downturn that is putting pressure on cash flows and repayment capabilities.The review has been sought by the finance ministry following appeals from various industries.
Gone are the days when banks would treat payment delays as part of life. Instead, they are taking measures to minimise chances of any kind of payment default by doing rigorous background checks.
The MD and CEO of ICICI speaks on how life will change and the bank's strategy going forward.
HDFC, the country's largest housing finance company, is planning to raise up to Rs 1,000 crore (Rs 10 billion) through non-convertible debentures with a green-shoe option next week. Sources close to the development said the company would issue NCDs worth Rs 200 crore (Rs 2 billion), while keeping an option to raise another Rs 800 crore (Rs 8 billion) through the green-shoe option.
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