J&K Bank to launch apple insurance scheme

In a significant step to promote horticulture sector, Jammu & Kashmir Bank has decided to launch a first-of-its-kind apple insurance scheme in the state next week. Bank chairman Haseeb Drabu said J&K Bank has made an investment of Rs 800 crore in horticulture, which needs to be enhanced keeping in view the vast potential of the sector. Drabu also suggested minimising risk factors in the horticulture sector to prompt financial institutions to make greater investments in the sector. He said apple, cumin seed and saffron are ideal products for profitable investments.

Loan recovery may lose muscle

Failed wrestlers and goons are an integral part of the country’s sophisticated financial sector. They are used in large numbers to recover dues from customers. Not averse to using some muscle power on the customer, they invariably get the job done. If the Reserve Bank of India (RBI) has its way, these tough-talking, muscle-flexing men could soon find themselves without a job. The RBI is working on a comprehensive set of guidelines that will make banks responsible for ensuring that their recovery agencies do not recruit individuals with a criminal background. The RBI move follows a sharp rise in complaints from credit-card holders against the recovery methods used by some banks. Recently, the Supreme Court had also expressed its strong reservations against banks recruiting goons for recovering loan dues. This does not mean that defaulters will be protected against the banks. Banking sources said once the new guidelines were in place, all banks would have to ensure that recovery agencies did a thorough background check of their employees, including police verification. The proposed RBI guidelines will also require each bank to publish the names of its recovery agencies, including on its website. Collection agents would be barred from making calls from any other number.

Banks cannot ignore weak spots: S&P

The banking sector in India is highly fragmented, with 53 domestic banks accounting for about 93 per cent of the system’s assets. The top 10 banks together account for 66 per cent of the system (as of March 31, 2006), with the remaining 27 per cent market shared between 43 banks. The banking business benefits from scale, especially with the increasing role of marketing- and technology-based systems. With about three-fourths of the banking systems’ assets in the hands of 29 public sector banks, a meaningful consolidation is not possible until this segment is included in the process. Hence, it is the government that determines the extent and speed of consolidation in the Indian banking system.

SBI`s sale of gold coins

State Bank of India (SBI) on Tuesday launched its scheme of retail sale of gold coins/ingots to the public at 15 branches in Andhra Pradesh. Coins of 2 gm and 5 gm and ingots of 10 gm will be initially sold at these branches. TS Bhattacharya, MD, said the scheme assumed importance as the corporates have started gifting gold coins to their employees as part of their reward and recognition initiative besides growing importance of gold at social functions.

ICICI sells 5.3% stake in Andhra Cement

ICICI Bank Ltd has sold its 5.30 per cent stake in Andhra Cement Ltd thereby reducing its holding in the company to 0.35 per cent from 5.65 per cent. It sold 62,10,997 shares, according to the data available on the BSE.

ICRA to rate IOB loans, exposures

Credit rating agency ICRA said it has signed a MOU with Indian Overseas Bank (IOB) for assigning ratings to the latter's loans and other exposures. The ratings would be done under the standardized approach of the RBI's New Capital Adequacy Framework for Basel-II, the rating firm said in a filing to the Bombay Stock Exchange.

Gold Rates

2 Gram 2205 5 Gram 5240 8 Gram 8295 20 Gram 20570 50 Gram 49900 100 Gram bar 95100

ICICI Bank in ‘phishing’ net?

India's largest private sector bank, ICICI Bank, is now in for a rude shock after a battery of e-mails that said that the bank's website was a victim of phishing, by which fraudsters steal passwords, user-names and other personal data of customers by setting up fake look-alike websites of companies.

YES Bank chalks out mega expansion plan

YES Bank is set for a mega expansion drive. The Rana Kapoor-promoted bank plans to foray into retail broking space and also carve out separate subsidiaries for existing banking segments. Besides, the bank is also looking for private equity investments to enlarge and enhance operations. While the retail broking business will be incorporated as a separate entity, YES Securities, the online transaction platform will be branded YES Direct. In fact, the bank is already looking at private equity placement for the new venture.

CBoP allots 13 cr shares to LKB shareholders

Centurion Bank of Punjab (CBoP) has allotted 13.21 crore equity shares to the shareholders of Lord Krishna Bank (LKB), which was merged with itself recently. The Reserve Bank of India (RBI) approved the amalgamation of LKB with CBoP and had said all branches of LKB would function as branches of CBoP with effect from August 29.

Bank unions defer strike

Bank employees have decided to defer the nation-wide strike called for Wednesday following the Indian Banks’ Association (IBA) assurance to commence negotiations on the unions’ demands within a fortnight.

Branchless banking - reaching out to remote villages

"If I want to visit the nearest branch, I will have to spend a major portion of may day's earning as bus charge to and fro (nearly Rs.10-12). With that, half of my day's productivity will come down," says Zulaikha, who also nurses her ailing mother at home. For Zulaikha, fellow village Shobha is the banker. Shobha, a member of the local self-help group, is the Business Correspondent of Corporation Bank in Surinje village of Dakshina Kannada district. Her home serves as the extension counter of Tadambail branch, situated 8 km away from the village, providing basic banking facilities to the villagers. Zulaikha wanted to deposit a portion of her savings with the bank at Shobha's house. After enquiring about the health of her mother, Shobha asked Zulaikha for her smart card, to be inserted in the small device kept at her house. Unlike in the sophisticated systems, where one has to produce a PIN (personal identification number) and passwords, the customer is asked to place her left thumb at the place marked on the device. Voice guidance from the device confirms the authentication of the transaction to both the customer and the banking correspondent. This system is now proving to be a role model on how banking facilities can be taken to more un-banked areas in the country.

BoB hires US consultancy to groom talent

Bank of Baroda (BoB) has appointed US-based consultancy firm, Wright Management Grow, to groom 300 employees in the scale-4 and above segments, as future senior managers. “The level of loyalty and commitment is very high among this bunch, in spite of the poor compensation package, so we decided that it is necessary to provide them with good development program along with an attractive incentive from the total profit,” said A K Khandelwal, chairman and managing director. The bank has devised several training programs to train recruits at various levels. The bank has been imparting specialised training for 500 young people in new segments such as mutual funds, wealth management and others. At the same time, the bank is also training 100 people for frontline sales and customer services.

Recovery ratings of NPAs soon

Distressed or non-performing assets can now have a better market with the credit rating agencies offering to rate such assets. The rating agency will assign the rating on the basis of the possibility and extent of recovery from a defaulted or non-performing asset through its recovery rating mechanism. Mr Krishnan Sitaraman, Head - Fund Services & Fixed Income, Research, CRISIL, felt that the key benefit of the recovery rating was basically an independent third-party evaluation of the recovery prospects in defaulted assets or NPAs based on which the banks or asset re-construction companies could arrive at a valuation to their investments backed by such assets.

Vijaya Bank biz volume rises to Rs 66,000 cr

"With a lift in the volume of business of more than Rs 22,000 crore since March 2006, our bank has moved from a small bank to a mid-sized bank in the country. Within a year and four months, the business volume which stood at Rs 44,471 crore in March 2006 has risen to around Rs 66,000 crore at present. Our aim is to register a business volume of Rs 1 lakh crore by 2010 with focus on SMEs, retail business and infrastructure,” Mr T. Valliappan, Executive Director, Vijaya Bank, said.

Gold Selling Rates (09.09.2007)

2 Gram 2205 5 Gram 5245 8 Gram 8295 20 Gram 20570 50 Gram 49900 100 Gram bar 95100

HDFC, Fidelity pick Corp Bank stake in NSE

Corporation Bank has offloaded its stake in the National Stock Exchange by 0.27 per cent. Fidelity Trustee Corporation and HDFC Ltd have together picked up the stake sold by the bank for Rs 35 crore on September 7. Earlier this year a host of institutional investors such as Industrial Development Bank of India, State Bank of India, SBI Capital Markets Ltd, Corporation Bank, Union Bank of India, Bank of Baroda, Canara Bank and Oriental Bank of Commerce had sold part of their stakes in the NSE.

Foreign banks looking beyond metros

The Reserve Bank of India would like foreign banks to get a flavour of semi-urban India and the rural hinterland. The branches of foreign banks that have been approved between July 2006 and June 2007 are mostly in smaller towns and tier-2 and tier-3 cities. Of the 13 branches for which permission was given, only one branch belonging to Shinhan Bank has been allowed in New Delhi. Most foreign banks follow a strategy of first setting up base in metros – Mumbai, New Delhi, Kolkata and Chennai. Then, in the next stage, they move to the mini-metros such as Bangalore, Hyderabad, Pune and Ahmedabad. Foreign banks in India have got approval from the Reserve Bank of India to open 10 branches and seven representative offices during the July 2006- June 2007 period. There are currently 29 foreign banks operating in India with 268 branches. There are also 34 other foreign banks that have representative offices. The share of foreign banks in the business done in the country (deposits and advances) has been hovering between 5 - 7% during the past decade.

ICICI Bank ties up with City Union Bank

ICICI Bank has tied up with City Union Bank (CUB) to provide its Money2India (M2I) online platform services to CUB customers. Under the tie-up, the non-resident Indian (NRI) customers of CUB will be able to transfer funds to their beneficiaries (CUB customers) in India. Besides online transfer of funds to CUB accounts, the remitter can also request for issuance of demand draft payable at over 2,300 locations across the country

Andhra Bank to hire in a big way

Andhra Bank will be hiring about 2,000 personnel in different categories over the next three years to strike a balance between retirements and new business needs. “The human resource needs of banks are now varied. In line with the business growth, we will be hiring clerks, probationary officers, market/finance executives, legal officers, rural development/agricultural officers, IT professionals and analysts,” Mr Kalyan Mukherjee, ED, said. The bank, which has indicated its likely foray into insurance, would also be needing domain experts in insurance. “We are not looking at big institutes like IITs and IIMs for campus recruitment. We are focusing on mid-sized institutes to bring in rural people, as we believe in employment inclusion,” Mr Mukherjee said.