Kerala-based private sector lender Dhanalakshmi Bank plans to recruit close to 400 employees, almost one-third of its present strength, to build up the existing team to tap more business
Most banks are going slow on clearing such loan applications as the employment scenario has turned adverse due to the financial crisis faced by most companies.
It is mission damage control and ICICI Bank is pulling out all the stops. Weighed down by persistent rumours over its health, the bank's top management will meet senior employees on Monday to reassure them about their future.
Some banks decide not to roll over short-term loans; others will do it only at higher interest.
Bankers have suggested that the Reserve Bank of India lower the statutory liquidity ratio and the cash reserve ratio as the present liquidity crunch is affecting their business. During the mid-term resource management discussion with the RBI team led by Deputy Governor Rakesh Mohan, the country's top bankers said the tight liquidity condition was pushing up the cost of funds and putting further pressure on margins.
The regulator wants to know if banks deploy the money to meet lending needs. Sources close to the development said that the central bank was checking if banks used the liquidity adjustment facility (LAF) for raising resources to meet short-term lending needs or pay off high-cost bulk deposits. Bankers said the central bank might be worried that the steps taken by it so far had not eased the liquidity situation and that call rates remained high.
A senior SBI official said bank branches and controlling offices face a piquant situation where the top management expects prompt action, including filing of a first information report, while the local police is reluctant to register complaints often due to political pressure. Of late, investigative agencies have raised concerns over the large circulation of counterfeit notes.
State Bank of India, the country's largest lender, is on an outsourcing overdrive. After outsourcing the back-office work in foreign offices, the bank has now decided to rope in external agencies to set up automated teller machines to save on capital expenditure and reduce the rollout time. It plans to initially outsource 500 ATMs to vendors, including original equipment manufacturers.
A clampdown on fresh personal loans, credit cards and auto loans is taking a toll on direct selling agents hired by banks to push these products. According to estimates, banks have reduced the number of DSAs by 15-25 per cent, while marketing expenses are 35-40 per cent lower.
The yen may have depreciated to 110 against the dollar from a high of 96 earlier this year, but bankers are advising extreme caution in using the Japanese currency for raising resources and hedging risks.
Government banks have demanded that the amount eligible under the farm waiver scheme should continue to be considered lending to the farm sector till the government clears the dues to help banks meet the mandatory priority sector lending target.
Continuing the flow of home loans and accessing low-cost deposits are two key elements of the government's instructions to public sector banks.
Global crude oil prices have dropped 14 per cent in less than a fortnight, but the three public sector oil marketing companies could still end up borrowing more in the domestic market and put further pressure on liquidity. With the three OMCs still saddled with under-recoveries, estimated at Rs 820 crore (Rs 8.2 billion) a day, they have no option but to use bank credit lines in the coming days as they have run out of their stock of oil bonds.
Banks are reluctant about disbursing loans for aviation studies on fears that a slowdown will hamper the job prospects in the aviation sector. The move, say analysts, may affect the fortunes of aviation training institutes.
In the latest annual report posted on its website, Danone has said it is negotiating with its partner with a view to selling its 25.5 per cent indirect stake in Britannia.
A day before the deadline of exclusive takeover talks between Anil Ambani's Reliance Communications and South African company MTN expires, Reliance Industries has invoked the dispute resolution clause of the non-competition agreement against RCom. However, RCom plans to go ahead with its proposed merger with MTN without taking RIL's claim into account.
The Kenyan government has dumped the Mumbai-based group in favour of a Libyan company for a 50 per cent stake in a refinery project in Mombasa. Essar officials said they are still negotiating with the Kenyan government so that they can invest in the project.
Swiss cement major, Holcim, promoter of two of India's biggest cement companies, ACC and Ambuja Cements, said there is no escape from increasing the cement prices in the country considering the high energy costs.
The Ruias of the Essar group have decided to get into yet another takeover battle. And this time they are taking on none other than Lakshmi Narayan Mittal, the owner of world's largest steel maker, ArcelorMittal, to take over the Bulgarian steel firm, Kremikovtzi AD, an ailing steel mill owned by Mittal's younger brother Pramod Mittal.
Sensing a correction in the real estate sector, commercial banks have become selective in lending to new residential and commercial real estate projects.
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