The bank’s loan disbursement grew by 18% year-on-year, from Rs.68,853 crores as on 30th Sep’08 to Rs.81,044 crores as on 30th Sep’09, while investments rose to Rs.52,072 crores from Rs.37,998 crores, over the same period, a growth of 37% year-on-year . The net interest income rose to Rs.1,150 crores during quarter ending September 2009 from [...]

Risk and Returns go hand-in-hand. When we look at high returns, the danger of risk is quietly lurking underneath, ready to pounce at a slightest miscalculation. Hedging refers to a method of reducing the risk of loss caused by price fluctuation. An example of a hedge would be if you owned a stock, then sold [...]

Housing finance major HDFC Ltd is looking to enter the rural segment with its tie-up with SKS Microfinance. SKS Microfinance will provide loans for extension and improvement of dwelling units that double up for income-generating activities such as eateries, papad and agarbathi-making etc and HDFC will provide technology support and a first tranche of funding of Rs [...]

24 Punjab National Bank is planning to expand its network in Maharashtra and has sought RBI permission to add 11 branches to the existing 156 in the State.

Bank of India has raised Rs 325 crore Tier-I capital through a bond issue. According to a press release issued by the bank, the capital was raised through the issuing of innovative perpetual debt instrument (IPDI) carrying a coupon rate of 9 per cent.

According to a media report, private sector lender Kotak Mahindra Bank is looking at acquisitions in India in the coming months.

RBI Governor D Subbarao announced that commercial banks would come out with a plan for financial inclusion by the end of the financial year. Mr Subbarao was speaking on the sidelines of a bankers’ meet on financial inclusion and promotion of financial literacy.

IDBI Bank and Tata Motors signed an agreement in Mumbai for providing auto finance to prospective customers.

India’s largest private sector bank, ICICI Bank, plans to go aggressive on car and truck loans again. The bank had been the biggest lender for automobile buyers till three years ago but had scaled back on auto loans in the past two years on the back of rising defaults. The bank is however discarding its [...]

General Motors, India, has entered into a tie up with the Oriental Bank of Commerce to finance it vehicles. A company release informed that GM India Vice-President (Sales and Marketing) Ankush Arora exchanged documents with Oriental Bank of Commerce General Manager A K Tangri in the presence of GM India President and Managing Director Karl [...]

In a bid to mop-up liquidity as credit growth remains sluggish, the RBI is considering bringing back the Market Stabilisation Scheme (MSS).

The Geneva headquartered Hinduja Bank has informed that it has increased stake in stock broking and financial services company Paterson Securities to 51 per cent, to expand its presence in India.

World Bank Group President Robert Zoellick recently  said the Dubai debt crisis is manageable and would not affect India. Mr. Zoellick was in New Delhi for a meeting with policy makers, including RBI governor D Subbarao and Planning Commission deputy chairman Montek Singh Ahluwalia.

Largest private sector lender ICICI Bank is all set to operate as a local bank in Singapore, following an in-principal approval from the city-state.

The Kerala High Court today adjourned a petition filed by Subramanian Swamy, a former Union minister, against the proposed commencement of an Islamic bank with state participation to January 5, for a detailed hearing.

State run lender Union Bank of India inaugurated its representative office in Sydney, Australia, on Wednesday and plans to upgrade its operations through a full-fledged branch or through a subsidiary bank in the country.

Union Road Transport Minister, Mr Kamal Nath, said after a meeting with World Bank President, Mr Robert Zoellick in New Delhi that The Road Transport and Highways Ministry would like to consult World Bank for technical, financial and legal inputs for the identified mega highway projects of the National Highways Authority of India and the proposed [...]

SBI has been the most aggressive bank in the advances space for the Year 2009. First it changed the housing loan scene overnight by announcing the 8% fixed cum floating interest rate scheme. Then it became the dominant player in the automobile loans domain too. SBI was one of the preferred banks for the loans [...]

The bank is one of the few which continued to grow its retail lending book even after the financial crisis. However, the growth rate has come down and officials say they will be cautious in their lending to the unsecured retail loan portfolio of credit cards and personal loans. The unsecured loan portfolio, which was [...]

The bank had gone slow on its housing loans, mortgage loans and automobiles loans (both 2 wheelers and 4 wheelers). Most of the automobile showrooms did not have an ICICI bank representative throughout the year. ICICI bank was also the last among the major banks to reduce the housing loan interest rate to the competitive [...]

Another simple measure to watch is net interest margin, which looks at net interest income as a percentage of average earning assets. Track margins over time to get a feel for the trend. PNB’s Net Interest margins have been generally stable in the 3.5 to 4 percent range. FY08 Net Interest [...]

Bank of India pioneered the introduction of the Health Code System in 1982, for evaluating/ rating its credit portfolio. This year however, the bank has been hit badly by bad debts. The bank’s profitability was impacted on the back of total provisions shooting up to Rs 883 crores (Rs 452 crores). Of the total provisions, [...]

UTI Retirement Solutions, the pension arm of UTI Asset Management Company has outshined SBI Pension Fund and Life Insurance Corporation Pension Fund in the New Pension Scheme (NPS) for government employees. Under NPS, employees have to contribute 10% of their basic salary and dearness allowance with a matching contribution from their employers. It is estimated [...]

The Life Insurance Corporation of India has awarded Indian Overseas Bank, Coimbatore region, with the ‘Bima Region’ award for excellence in insurance business.

According to Economic Research Report by Macquarie, the Reserve Bank of India(RBI) may hike the Cash Reserve Ratio next month and policy rates by April in view of the rising inflation and excess liquidity in the money markets.

Bank of Baroda will soon be opening a foreign branch in Auckland, New Zealand, through a 100 per cent subsidiary of the banks, according to Mr M.D.Mallya, Chairman and Managing Director.

Union Finance Minister, Mr Pranab Mukherjee, said that the Government cannot allow commercial activities of banks to be supervised by representatives of people. Mr. Mukherjee was speaking in the Lok Sabha.

SBI Cards, one of the largest credit card issuers in the country is moving on to better times. The credit card major saw its non-performing assets (NPAs) fall to 9.77 per cent, as on September 30, against 10.5 per cent at the same time last year. Formerly, the NPA’s had reached an all time high [...]

In the near future, banks may be able to do away with the “know your customer” process. This is a possibility once a sizeable chunk of population gets a Unique Identification number. Addressing the press after attending a meeting organised by the Reserve Bank of India (RBI) on Friday on using UID for financial inclusion, [...]

The government owned bank, United Bank of India, is likely to file a red herring prospectus with the Securities and Exchange Board of India for their initial public offer (IPO) next week. This was stated Chairman by the Chairman of the bank, Mr. Satish C Gupta. Mr. Gupta said, “We hope to come out with the IPO [...]

According to a statement released to the press by United Bank of India, the bank has obtained licenses for opening 11 new branches in unbanked gram panchayats in the state of West Bengal. This is being done in the backdrop of the recommendations of the T M Bhasin Committee, appointed on behalf of West Bengal State [...]

A key Parliamentary Standing committee has recommended that financial charges levied by credit card companies should not be left entirely at the discretion of the banks. The high interest rate charged by credit card providers has finally caught the eye of the law makers and this recommendation is sure to create pressure on the RBI to regulate [...]

In its mid - year review for 2009-10, which was tabled in Parliament by Finance Minister Pranab Mukherjee,  the Govt. said the Reserve Bank needs to withdraw the easy money policy gradually so as to ensure sustained economic recovery and contain inflationary expectations.

One of the most repeated pleas of NBFCs on the direct taxes front is the issue of parity with banks and housing finance companies in the areas of allowing provision on non-performing assets as a deduction. This provision, made in accordance with the prudential norms of the RBI, can be claimed as a deduction for [...]

As per data at a disaggregated level drawn from 49 banks accounting for 95 per cent of total bank credit, the year-on-year growth in bank credit to industry was lower than that in the previous year. While the credit flow to agriculture, real estate and SMEs remained high, it was lower for housing, NBFCs and [...]

Global funds invest in international companies and/or mutual funds investing in international companies. Some of these funds can also choose to focus on investing in international companies operating in a particular sector. Few funds are hybrid i.e. they invest a part of their money in Indian companies and remaining portion [...]

As part of its global expansion plans, the State-run Oriental Bank of Commerce plans to open more offices in Hong Kong and Africa.

New generation private sector bank, IndusInd Bank, inaugurated Mumbai’s first solar-powered automated teller machine. This move comes as a part of its Green Office Project campaign “Hum aur Hariyali”. As another part of the campaign, the bank also unveiled a “Green Office Manual - A Guide to Sustainable Practices,”. The manual has been prepared in association with [...]

A senior bank official of private sector lender Dhanalakshmi Bank said the bank is aiming for a total business of Rs 12,000-crore by FY10. The bank is also planning to hire 300 more personnel to take its total headcount to 4,000 by the same period.

Citibank recently launched CitiHome One, a unique universal mortgage product, that would enable customers to get a home-loan as a combination of a conventional term-loan and credit line. With the launch of this new scheme, customers will be able to enjoy the dual advantage of interest savings on their home-loans by utilising surplus funds as [...]

Leading public sector lender HDFC plans to disburse Rs 3,000 crore over the coming two-months under its special housing loan plan, launched early this month and offering an interest rate of 8.25 per cent.

As part of its schemes for the festive season, leading public sector bank, Punjab National Bank has offered to grant home loans at floating interest rates up to 2.5 percent below the prevailing Public Lending Rate till the end of this year.

Year 2009 has been a significant year to showcase RBI’s success in regulating the banks in India. Most banks have been cautious with their lending to risky profiles. Certain unsecured loans were not sold at all. This has helped almost all the banks to be more powerful as their non-performing assets have come down.

Year 2009 has seen many long felt needs in the banking sector and user group (read as borrowers and account holders) being met. The liberalization of the branch opening process in smaller cities will help the banks and also the people in remote and rural areas.

In the wake of possible Cash Reserve Ratio hike, banks are considering increasing the sub-prime lending rate, while keeping the benchmark prime lending rate (BPLR) untouched.

The Export-Import Bank of India has extended a $100-million Line of Credit to Vneshecomobank, the Russian State-owned Bank for Development and Foreign Economic Affairs. The agreement was signed by Chairperson and Managing Director, Exim Bank of India, Ms. Ravneet Kaur and the Chairman of Vnesheconombank, Mr Vladimir Dmitriev.

Private sector bank, IndusInd Bank has presented its plan to the Reserve Bank, to bring down the promoter stake to the compulsory 10 per cent over the next 2-3 years.

The Small Industries Development Bank of India has disbursed Rs 1,500 crore to 10 banks for lending to micro/unorganised enterprises. The loan is provided upto December 1 2009. In a written reply in the Lok Sabha, Minister of State (Independent Charge) Dinsha Patel said, “SIDBI has set up a special cell for providing re-finance to banks for further [...]

Moody’s has upgraded the long-term foreign currency deposit ratings of 14 domestic lenders, which include State Bank, ICICI Bank, Axis Bank, Bank of Baroda, Bank of India, Canara Bank, Central Bank of India, Exim Bank, HDFC Bank and IDBI Bank amongst others.

Private sector bank, City Union bank Limited launched its Online Trading product ‘Cub-Share-Trade’ in association with leading financial services provider, Geojit BNP Paribas. The Memorandum of Understanding was signed by Managing Director and CEO, City Union Bank Ltd., Mr. S. Balasubramanian and Managing Director, Geojit BNP Paribas Financial Services Ltd., Mr. C J George.

Public sector lender, State Bank of India, has received final approval for its general insurance subsidiary from the Insurance Regulatory Development Authority. State Bank of India has entered into  a joint venture with Australia-based Insurance Australia Group (IAG) to form SBI General Insurance.

This year we saw introduction of currency futures i.e. contracts for buying and selling foreign currencies against INR. Currencies are thought to be one of the most liquid market due to presence of countless players and 24×7 market structure. Even if NSE and [...]

The mutual funds advisory committee is also looking at more reforms. The advisory is recommending the asset management companies to lower the fund management fees from the present. The fund houses currently charges 1.25% as asset management charges for the first Rs 100 crore garnered by a scheme, and 1 per [...]

During a market downturn, ETFs have different provisions in everyday tools for doing allocation of assets in line with your risk appetite and tolerance and your financial goals. This way you can protect your portfolios. You can allocate assets in various classes by reducing your portfolio exposure to equity capitalizations, [...]

As the features offered by each credit card varies, it is essential for you to understand which features will benefit you a lot. If you are shopping regularly at a particular store, go for a credit card that offers your reward points or cash back or discount when you shop at that store. Don’t select [...]

Due to the current economic slowdown most banks had stopped giving out Sub-PLR loans for some time. With improved liquidity conditions, banks have come back on the trend of disbursing loans at discounted rate that is below benchmark prime lending rates (BPLR). Majority of fresh loans, around 65% to 70% are being disbursed at sub-PLR [...]

A Demat account is very similar to a bank account. In bank accounts you electronically hold money, whereas in Demat accounts you electronically hold shares. All buying and selling of shares happens through a Demat account. The Securities and Exchange Board of India (SEBI) mandates a demat account for share trading [...]

Following banking giants such as SBI, ICICI Bank and HDFC, state-owned IDBI Bank has joined the home-loan war with the launch of its fixed cum floating rate home loan. The bank is offering 8.25 per cent fixed rate for all its new loans till March 2012.

Now there is talk of recession being over, markets being revived and the in general people out of their cautious cocoons where they were waiting and watching before grabbing the loans at attractive interest rates. For the past few months every bank has been vying with each other to provide competitive interest rates that will [...]

A strong focus on retail advances has helped State Bank of Hyderabad (SBH) to pick up credit growth during the months of October-November.

SBI Life Insurance has tied up with Coromandel International Ltd to offer insurance in rural areas in Andhra Pradesh through Coromandel’s ‘Mana Gromor’ brand of rural retail outlets.

Visakhapatnam Urban Co-operative Bank has crossed the Rs 1,000-crore mark in business turnover. The bank has Rs 594 crore in deposits and the rest in advances.

Tata Motors has entered into an agreement with Vijaya Bank according to which the bank would provide loans for financing of purchase of vehicles manufactured by Tata Motors.

Central bank of India has entered into an agreement with Star Union Dai-ichi Life Insurance to launch a scheme that assures life-time annuity for senior citizens opting for a reverse mortgage loan from the bank.

P/E ratio (Price Earnings Ratio) shows what the market thinks about the earnings potential and future business forecast of a company. Companies with high P/E ratios are the darlings of the investors and thus enjoy a higher market rating. In order to use the P/E ratio properly, take into account the future earnings and growth [...]

These funds are suitable for novice investors who don’t have any clue about the stock market investment. However over a long term, these funds should form a part of overall portfolio of investors. This is because investing solely in these funds will deprive the investors of earning higher returns generated by mid and small cap [...]

As a consequence of the RBI’s decision to restore the all-in-cost ceilings on external commercial borrowings (ECBs) with effect from January 1, banks may see improved credit demand, especially from mid-rung and smaller companies.

Central Bank of India plans to raise Rs 400 crore through a bond issue in two months, and may also get Rs 700 crore as fresh capital from the government.

Closer to home, an 18-year-old IIT student posed as a bank executive, got credit card details from customers, and then used the data to book air tickets and buy laptops. He tied up with a travel agent to cancel the tickets and share the returns, while he sold the laptops across the country at a [...]

As a matter of prudence one might think of withdrawing investments from risky products to safe ones, just before the requirements arise. Say, disposing off the equity investments just when the junior is 16 or 17 and putting the money in MMMFs or debt funds or fixed deposits. This practice shall definitely bring the return [...]

Historically, gold has been the perfect hedge for inflation. This is based on data from the year 1800 AD. But in terms of absolute returns gold has fared rather poorly giving returns at only 0.8% above inflation. Real estate and shares beat gold squarely on the capital appreciation front. Real estate and shares have given [...]

Whatever your earnings, you can set aside a portion for saving. Simple budgeting, translated as spending lesser than you earn can pave the way to start saving. If you do not think about saving as early as possible you will lose out on significant sums of money at a later stage in life. Needs are [...]

Based on the amount of money you’ll need daily for food, hotels, car rentals, activities and miscellaneous purchases, make a realistic budget. Budget a little extra for emergencies or for last minute shopping but do not, and I repeat do not, carry a whole lot of extra cash thinking you’ll bring [...]

LAP (loan against property)  is one of the cheapest retail loans after home loans; usually in the range of 12% - 16%. Since the rate of interest is lower, frequently LAP Equated Monthly Installments (EMI) turn out cheaper.Maximum loan eligibility is determined primarily by the value of the property and income.

ICICI Bank has announced a fixed-cum-floating home loan rate scheme under which the bank will offer loans at a fixed rate of 8.25 per cent for the first two years, irrespective of the amount, and from the third year onwards, the rate will be the applicable floating rate and will vary depending on the amount [...]

Kotak Mahindra Bank has announced a new fixed cum floating loan scheme wherein the bank will offer a rate of 8.49 per cent for the first 30 months from the date of disbursement and for the rest of the loan duration, the rate will be the applicable floating rate. The fixed rate of 8.49 per [...]

The change in the rule related to gifts says that the receiver has to pay tax for receiving any gift valued at Rs.50,000 and more. The ‘any gift’ clause means that not only cash but all gifts of any value. So if someone receives a gift of a house worth Rs.30 lakhs, then he/she is [...]

These are some basics that you should know when obtaining a personal loan. These days, securing a loan is easy. Repayment is the tough bit. When you don’t repay on time, the recovery agent may come knocking at your door. When getting a personal loan it is important to ask yourself [...]

Liquidity can also affect arbitrage funds. As futures are traded in lots, one lot will have numerous shares of a company. A fund manager may not be able to buy the required number of shares at a predetermined price. E.g. [...]

Dr D. Subbarao, RBI Governor has stated that the capital inflows into the country are in line with the Reserve Bank of India’s expectations and there is no cause for concern of a possible build-up of asset price bubbles.

If the idea is so good and giving so many benefits, why is it that somebody else has already not done it? This is tough question faced by any innovator. A genuine answer to this question is required rather than saying, “There is no one as bright as me”. There is no point in trying [...]

With new developments under the Ministry for MSME (Micro, Small and Medium Enterprises), banks are given guarantee for their loans to the small and medium enterprises under the aegis of Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE). Hence the trend to give loans without collateral is picking up. the cover by CGTMSE [...]

These are high net worth Individuals who are ready to invest in start up companies. The typical investment cap is at Rs.1 crore starting from as low as Rs.10 lakhs to Rs.25 L. They expect equity from the promoters and exit typically by selling their equity in the next rounds of funding.

While no investment option can guarantee returns, over the past one year, top-performing gilt funds have managed to generate returns exceeding 20%. This is because in the recent times, RBI has introduced number of interest rate cuts. As there is an inverse relationship between the interest rates and the prices of bonds, reduction in interest [...]

The Electronic Clearing Service (ECS) is a retail payment system that can be used to make bulk payments or receipts. Its aim is to decrease volumes of paper instruments in MICR clearing and improve customer service by ensuring prompt and secure interest/dividend payments to the beneficiaries. Coupled with a system [...]

SBI Card, the Joint venture from the State Bank of India and GE Capital, has launched mShop, a scheme to enable its customers shop from over 100 merchants across the country, using their mobile phones.

Another interesting story surrounding this brand is how the logo came into being. The logo for the Mercedes brand was a three pointed star and had been chosen because Gottlieb Daimler had often used a star as a symbol and was fond of saying that this star would one day shine over his own factory [...]

Asset allocation, as explained above, is a process wherein an investor takes a decision of how his portfolio will be diversified. Diversification is an important goal for an investor. Putting all the savings in equity market might not be a safe investment decision while investing in fixed income securities is also not advisable looking at [...]

In this era of recession, deflation, and job cuts, it is especially important for you to consider where your hard-earned money is going; financial security is the key in today’s unpredictable world. And the first step towards gaining that security is to have a saving plan.

There is no set upper limit to the amount you can pay as down payment - it all depends on how much cash you can manage to set aside. The more you are able to pay as down payment, the lesser is the amount of loan taken from a bank, resulting [...]

According to a company release, HDFC has launched a special home loan product at a fixed rate of 8.25 per cent a year valid up to March 31, 2012 and the applicable floating rate for the balance term, i.e after March 31, 2012, the interest rate will be changed to the then prevailing floating rate [...]

If one buys a 500 sq.ft flat in Navi Mumbai at a cost of Rs 3500 per sq ft, the total cost would be Rs 1750, 000. At an 8.5% interest for 15 years, the interest rate would be Rs. 13,51,940. If the prices go up to Rs 5500, the cost jumps by 57% to [...]

ICICI Bank has raised around Rs 3,500 crore through an overseas bond issue, the bank said in a press release. The “5.33 year” fixed-rate paper was issued through the bank’s Bahrain branch and saw a total subscription of over $3 billion from over 250 investors.

One very important aspect we need to understand is that after the age of 45 no insurance company will provide a health policy without medical check examination. Once the medicals are done and the individual is prone to even 0.001% of any disease, that particular ailment will be excluded from the [...]

The expense ratio is the proportion of recurring expenses that a fund charges to its schemes year after year, and so the Expense Ratio is also known as Annual Recurring Expenses. This basket of charges comprises the fund management fee, agent commission, registrar fees and the selling and promotion expenses.

Once you have identified the fund boxes — Spending forecast, contingency fund for job loss and medical expenses, be dedicated and generate your money flow into these funds consistently. This could be once a quarter but it would be more manageable if it’s once a month.