BoM to raise Rs 300 cr through bonds

Public sector lender Bank of Maharashtra will raise up to Rs 300 crore through a bonds issue during October 12-13 to meet the capital adequacy requirement. The Upper Tier II bonds with a maturity period of 15 years will be issued at a coupon rate of 9.10 per cent per annum, the bank informed Bombay Stock Exchange. The bank will pay 9.6 per cent interest per annum from 10th year onward if the call option is not exercised

PNB biz hits Rs 2,13,000 cr

The country's second largest public sector lender Punjab National Bank has achieved a business of Rs 2,13,000 in the first half of this fiscal. "The total business (deposits and advances) is around Rs 2,13,000 crore and we expect to surpass the goal of deposits and advances set for the year end-March 2007," a senior PNB official said. Deposits of the bank stood at Rs 1,29,000 crore while advances were at Rs 84,000 crore till September this year. The bank had set a business target of Rs 2,25,000 crore for 2006-07.

Union Bank to raise Rs 1,400 cr in 5 mths

Union Bank of India plans to mobilise Rs 1,400 crore capital funds through issuance of bonds over the next five months. This week, the mid-sized public sector bank also raised Rs 300 crore of perpetual debt. The bank raised the Rs 300 crore through its maiden perpetual debt issue at a coupon rate of 9.45 per cent for the first 10 years and 9.95 per cent for all subsequent years. Union Bank has drawn up a massive capital-raising plan to maintain its capital adequacy ratio (CAR) substantially above the mandatory 9 per cent even after implementing the Basel-II capital adequacy norms. The bank requires capital funds not only to support credit growth but also to provide nearly Rs 500 crore for operational risks under the new capital adequacy norms

HSBC money transfer scheme

Global bank HSBC has launched a new money transfer service for Indians living in the Gulf in a bid to boost its share of the multi-billion dollar India remittance pie. The 'One World' money transfer scheme will allow Indians to open bank accounts in the UAE even before they arrive here, to transfer their credit history from India as well as help with their credit card and mortgages, Mr Manasije Mishra, head of NRI services for HSBC India said on Tuesday. Indians living in the UAE can also transfer money to their HSBC accounts in India free of charge using cheques or the Internet.

Yogesh Agarwal, new SBI MD

The State Bank of India has a new Managing Director in Mr Yogesh Agarwal. He has been appointed as Managing Director of the board of State Bank of India with effect from October 10. Prior to this appointment, Mr Agarwal was the Managing Director of the State Bank of Patiala.

SBI commercial branch in Bahrain soon

The State Bank of India is set for a major expansion in Bahrain with the opening of its first commercial branch in the country next month. The bank had set up its first office in Bahrain 30 years ago and earlier upgraded its status to the headquarters of its West Asia and North Africa operations

CIBIL plans products to spot good customers

Mr S. Santhanakrishnan, Chairman, Credit Information Bureau of India Ltd (CIBIL) said, till now the focus with regard to using the CIBIL database had been more on spotting the defaulters and avoiding the possibility of refunding such delinquents. CIBIL is coming out with a couple of new products that will enable banks to spot their good customers and reward them. Another product, 'Macro analysis of the bureau data', sliced product-wise, geography-wise, is to be launched in December. With this, banks can thus compare their own profile vis-à-vis the industry profile as thrown up by the bureau data and take suitable corrective measures to shore up the risk profile of their books. CIBIL would also be launching "Bureau Credit Scores" for individual borrowers by February 2007. This is a product that is getting introduced in India for the first time.

PNB plans to tap HNIs, may offer portfolio services

For a country witnessing 19% growth in its number of high net worth individuals (HNIs), this sure is opportunity for banks like Punjab National Bank, which is planning a foray into offering portfolio management services (PMS). It is currently waiting for regulatory approvals. “We are looking to enter the portfolio management space. But as public sector banks, we are not allowed to offer advisory services. We are sorting some regulatory issues with the RBI,” a top official at the bank said. The RBI rules say a bank must firewall its PMS portfolio from its other business, to ensure that the bank’s exposure in capital markets does not affect its balance sheet. Also banks have to obtain a dual licence from RBI and Sebi, before they can offer discretionary PMS - i.e., manage the funds actively on behalf of their clients. At present, public sector banks are losing out to foreign and private banks in offering such services.

IBA concern over home loan frauds

The Indian Banks Association is concerned about the proliferating cases of housing loan frauds. It has undertaken a survey of member banks to collect data on housing loan frauds and evolve a concrete action plan to tackle the problem. IBA has asked member banks to provide information on frauds they have encountered by fabrication of income documents (such as IT return, salary slip etc), encashment of loan cheques by third parties, frauds caused by forged title documents (through use of colour photocopies and fake stamp paper), overvaluation of property to secure higher loan amounts and instances of multiple financing by different agencies. Housing loans grew from a level of Rs 16,000 crore in 2001 to a level of Rs 1,86,000 crore in 2006.

South Indian Bank plans to change logo

Within a week of notifying the stock exchange about its intention to look for takeover of a mid-sized or smaller bank, the Kerala-based South Indian Bank informed the exchange about its proposed decision to change the 'logo'. The bank's Chairman, Mr V.A.Joseph, told that the image makeover was intended to give it a 'national or global image'. The bank is also in the process of finalising its Brand Ambassador. The bank has also initiated steps to renovate the interiors of some of its age-old branches to give it a 'look-alike wherever you go' feel.

HDFC Bank in pact with India Post

HDFC Bank has tied with up with India Post, Karnataka Circle, to offer loans to investors in small savings schemes. The loans would be in the nature of overdraft facilities against National Savings Certificates and Kisan Vikas Patras, according to Mr Biju Pillai, Vice-President and Business Head, HDFC Bank. The loans would be extended up to 90 per cent of the value of the savings scheme certificates and interest would be charged on the amount drawn.

Bank strike on Oct 27

Bank unions across India have called a strike on October 27 to demand certain benefits and protest against bank mergers and outsourcing of banking activities, a union leader said. The demands related to pension benefits and appointment privileges, said Mr Prafulla Patnaik, Chief Convenor of the United Forum of Bank Unions.

Union Bank bonds sale

Union Bank of India has raised an additional capital of Rs 300 crore through an offering of Hybrid Tier I Capital. The issue opened on October 9 and closed the same day fully subscribed. The perpetual bond, having a call option to redeem after the tenth year, carries a coupon rate of 9.45 per cent payable annually, with a step-up option of 50 basis points at the end of the tenth year if the call option is not exercised.