Fed beats expectations; cuts key rate by 50 bps

The Federal Reserve cut a key interest rate for the first time in four years, seeking with an aggressive half-point move to prevent a steep housing slump and turbulent financial markets from triggering a recession. The Fed announced on Tuesday that it was reducing its target for the federal funds rate, the interest that banks charge each other, from 5.25% to 4.75%. The halfpoint reduction was double the quarterpoint move that many economists had been expecting. Commercial banks were expected to quickly match the Fed’s action by cutting their prime lending rate. The prime rate has been at 8.25% for the past 15 months.

Now, passbook update at ATMs

Now you can withdraw money and simultaneously get your passbook updated at the automated teller machine (ATM) instantly. Banks in association with NCR, a technology company, are planning to get the self service technology in India. “Every passbook update costs the bank Rs 70 to Rs 80. The updating of passbooks at ATMs is a good concept but in India we have major bandwidth problem. Banks will have to train customers, there could be instances where in the passbook could get stuck in the printer. The customer wait time at the ATM will also increase,’’ said a retail banking head of a private bank

BoI relocates site hosting from US to India

After facing attacks on its website, the Bank of India has shifted website hosting from United States to India in an attempt to have greater control over operations. The site was hacked on August 31, 2007 and remained inaccessible for many days. There were attempts to load multiple copies of malware, one of which had features to steal information such as user names and passwords

StanChart buys AmEx, expands India presence

Standard Chartered Plc today reached an agreement to acquire US-based American Express Bank Ltd for about £431 million ($860 million) in cash - a deal that would give the British banking major additional branch licences in India. American Express Company (AXP), which agreed to sell its banking business American Express Bank to UK's Standard Chartered, said the sales does not include its primary card and travel-related businesses.

Lakshmi Vilas goes live with RTGS

Lakshmi Vilas Bank has gone live with RTGS (Real Time Gross Settlement) transactions across its 120 Core Banking Solution enabled branches. This facility would enable LVB customers in faster transfer funds between banks, better fund and liquidity management and considered more secure. The bank has established a primary site for RTGS at Chennai and a disaster recovery site at Mumbai.