Mottos for Success-277
“If knowledge is not applied in some concrete way, then it disappears from human consciousness”
1.Year 2006 has been a busy year for the Indian banking industry. The buzz of takeovers and Basel, interest and alliances, never seemed to fade away. Banks in India encountered many challenges and opportunities amidst strong and sustained economic growth
2. Assocham has asked the RBI to roll back the cash reserve ratio to the previous level of 4.5% as the liquidity crunch in the market is affecting the industry. According to the chamber, a series of hikes in the cash reserve ratio from the initial level of 4.5% by the RBI has created liquidity crunch in the money market to the extent that the call rates touched the nine-year high rate of 19%.
3. Encouraged by an experiment done by a grameen bank in Karimnagar district, major bankers in Andhra Pradesh have decided to seriously consider extending loans to SHGs at `pavala vaddi' (3%interest rate) against 36% by microfinance institutions (MFIs). The idea is to help the SHGs retire high-cost loans, bringing in a great relief to the members who are often fleeced by some MFIs.
4. Unabated demand in credit resulting in strong business growth along with wider options for raising funds have seen banking industry perform well in 2006. Hardening interest rates may have made the credit dearer, but this did not stop banks from expanding their balance sheets. Loan books of banks have grown by about 31%, while riskier asset classes (such as retail, real estate and SMEs) have clocked a higher growth of about 45%
5. BOI paid a 20%interim dividend (Rs67.72 crs)to the Govt. for 2006-07. The Govt holds69.74% equity in the bank. The bank has paid total dividend at the rate of 30 % per share for the fiscal 2005-06.
6. Union Bank of India tied up with LIC of India to launch `Union Double Plus'— a group insurance scheme for fixed deposit account holders. The scheme is open to all fixed deposit accountholders including staff accountholders of the bank in the age group of 18-55 years. The insurance cover is limited to a maximum of Rs 5 lakh. If the initial FD is more than Rs 5 lakh, the cover will be as if the initial deposit is Rs 5 lakh.
7. The Santhi Social Circle of the SBT, Santhi Nagar branch, is reaching out to students during the course of a 10-day residential camp being held under the auspices of the National Service Scheme. Around 150 students are participating in the camp. A session on banking habits and the role of banks in national development was conducted during the course of the camp.
8. Karur Vysya Bank offers 9.25% interest on Senior Citizen Deposits, for period ranging between 1 & 3 years, said to be the highest in the industry. The bank has recently rolled out a deposit scheme, KVB500. The sums deposited under this scheme would attract interest at 9 per cent and for tenure of 500 days. The bank has increased the rate of interest on domestic term deposits by 50 to 75 bps on various time brackets. It offers the highest rate of 8.75% on deposits with tenure between 2 and 3 years, and at 8.5% for the one to two-year deposits. BPLR rate has also been hiked to 13.25%(12.5%). The bank has filed the draft offer document with SEBI and the NSE for issue of rights shares.
“If knowledge is not applied in some concrete way, then it disappears from human consciousness”
1.Year 2006 has been a busy year for the Indian banking industry. The buzz of takeovers and Basel, interest and alliances, never seemed to fade away. Banks in India encountered many challenges and opportunities amidst strong and sustained economic growth
2. Assocham has asked the RBI to roll back the cash reserve ratio to the previous level of 4.5% as the liquidity crunch in the market is affecting the industry. According to the chamber, a series of hikes in the cash reserve ratio from the initial level of 4.5% by the RBI has created liquidity crunch in the money market to the extent that the call rates touched the nine-year high rate of 19%.
3. Encouraged by an experiment done by a grameen bank in Karimnagar district, major bankers in Andhra Pradesh have decided to seriously consider extending loans to SHGs at `pavala vaddi' (3%interest rate) against 36% by microfinance institutions (MFIs). The idea is to help the SHGs retire high-cost loans, bringing in a great relief to the members who are often fleeced by some MFIs.
4. Unabated demand in credit resulting in strong business growth along with wider options for raising funds have seen banking industry perform well in 2006. Hardening interest rates may have made the credit dearer, but this did not stop banks from expanding their balance sheets. Loan books of banks have grown by about 31%, while riskier asset classes (such as retail, real estate and SMEs) have clocked a higher growth of about 45%
5. BOI paid a 20%interim dividend (Rs67.72 crs)to the Govt. for 2006-07. The Govt holds69.74% equity in the bank. The bank has paid total dividend at the rate of 30 % per share for the fiscal 2005-06.
6. Union Bank of India tied up with LIC of India to launch `Union Double Plus'— a group insurance scheme for fixed deposit account holders. The scheme is open to all fixed deposit accountholders including staff accountholders of the bank in the age group of 18-55 years. The insurance cover is limited to a maximum of Rs 5 lakh. If the initial FD is more than Rs 5 lakh, the cover will be as if the initial deposit is Rs 5 lakh.
7. The Santhi Social Circle of the SBT, Santhi Nagar branch, is reaching out to students during the course of a 10-day residential camp being held under the auspices of the National Service Scheme. Around 150 students are participating in the camp. A session on banking habits and the role of banks in national development was conducted during the course of the camp.
8. Karur Vysya Bank offers 9.25% interest on Senior Citizen Deposits, for period ranging between 1 & 3 years, said to be the highest in the industry. The bank has recently rolled out a deposit scheme, KVB500. The sums deposited under this scheme would attract interest at 9 per cent and for tenure of 500 days. The bank has increased the rate of interest on domestic term deposits by 50 to 75 bps on various time brackets. It offers the highest rate of 8.75% on deposits with tenure between 2 and 3 years, and at 8.5% for the one to two-year deposits. BPLR rate has also been hiked to 13.25%(12.5%). The bank has filed the draft offer document with SEBI and the NSE for issue of rights shares.
