Tides of 2.04.2007 100th Issue

1. Aviva Life Insurance Company Ltd is open to picking up equity stakes in Indian banks for cementing its bancassurance arrangements. Aviva already has equity investments in financial institutions in Europe. Aviva has equity investments in Italian banks and financial institutions that also provide a life insurance distribution network. Aviva India is a 74:26% joint venture between the Dabur group and Aviva Life Plc of the UK.

2. Public sector banks have started going in for short contractual appointments. Earlier, private and foreign banks offered these kinds of jobs - to reduce their wage bill and also remove the unpleasantness of firing someone after they had outlived their purpose. SBI and IDBI are among those that have decided to appoint executives for a short tenure. SBI is recruiting about 1,000 customer relationship executives, while IDBI is recruiting about 450 executives on a contract basis. Most of these new executives will be based in the metros and top urban centres, to sell banking services to small and medium enterprises (SME) and personal banking segments.

3. Corporation Bank and HDFC Bank have been authorised to undertake Primary Dealership business effective April 2.

4. The public sector general insurance companies under the revised promotion policy will be holding written test for its officers for promotion up to the cadre of Chief Manager (Scale V).

5. Andhra Bank's Chennai zone, comprising Tamil Nadu and Kerala, has ended 2006-07 with total business of close to Rs 5,000 crs. This makes the zone almost as big as City Union Bank. The business has more than doubled in under two years. The zone has 88 branches, 40 ATMs and eight extension counters. It plans to put up another 11 branches in 2007-08.

6. THE PACKAGE for promotion of Micro and Small Enterprises (MSEs) placed by the government in Parliament last month, is by and large a repetition of past promises without concrete plans of action or fund allocations, though it has also some welcome features, especially in respect of entrepreneurship development among women. The least the government should have done is to announce tax relief to public sector banks and financial institutions on their contributions for to the Credit Guarantee Corpus of the Small Industries Development Bank of India (SIDBI), instead of merely announcing an intention to study the feasibility of allowing such deduction.

7. It’s belt-tightening time for home loan borrowers. Auto and consumer loans could also get costlier as the RBI, in an all-out attack on inflation, is tightening the noose around banks. Unlike in the past, when bankers extended the tenures of home loans instead of raising the quantum of monthly payments, this time your equated monthly instalments (EMI) are bound to rise. But people with money in the bank, especially senior citizens, can rejoice. When money is tight, deposit rates go up. Banks are already offering rates of 9.5-10% on deposits above one year. Rates will soon touch 10-10.5% for deposits up to three years.

8. From the sublime to the prosaic, the Brand Equity Quiz '07 had it all. India's largest corporate quiz showsaw a first in the regional round in Mumbai. After the preliminaries and with 70 teams competing, four teams qualified on stage directly. With Deutsche Bank and UTI slogging it out for the finals, the stage was set for some rapid fire quizzing. Both teams were buzzer-happy, sometimes to their detriment. Even before O'Brien had finished asking the question — which company sells the largest selling drug for cholesterol? — Deutsche Bank hit the buzzer. Waiting impatiently for him to finish asking the question, both Sudipto Roy and Rajiv Rai of Deutsche Bank called out in unison — Pfizer's Lipitor. The duo bagged the first prize of Rs 1.30 lakh and a chance to brush up on their skills for the final to be held at the end of April, with nine other cities coming to Mumbai for the final.