Tides of 29.01.2008

1. Reliance Money is aiming to take up the distribution reach of the company to all the 5,645 tehsils of the country after having succeeded in mobilizing 10 lakh plus IPO applications for the Reliance Power that concluded recently.Reliance Money a subsidiary of Anil Dhirubhai Ambani Group Company, Reliance Capital and is into equity broking and distribution of IPO, mutual funds, insurance and other financial products.

2. The life of the central banker has never been more difficult and challenging.In the good old days, it was enough if he focused on the domestic economy, its growth prospects and inflation, while cocking an eye on the current account and exchange rate. Last week, the US Federal Reserve, in a rare move, cut its benchmark Fed Funds rate from 4.25 per cent to 3.5 per cent in one go. And this was even before Wall Street opened. The collapse of Asian and European markets before US trading began set off alarm – if not panic – bells in the Fed, prompting its pre-emptive action.

3. Kotak Mahindra Life Insurance plans to sustain a growth of around 100 per cent in new business premium over the next year.In the first nine months of the fiscal, the company has raked in new business premium of Rs 560 crore (in terms of annualised premium equivalent where single premium is given only 10 per cent weightage), which is a growth of 80 per cent against the previous year. The company has reported a net loss of Rs 67 crore in the first nine months of the fiscal.

4. The General Insurance Corporation of India (GIC Re) has inaugurated its branch office in London. The Finance Minister, Mr P. Chidambaram, who inaugurated the office described it as a “giant step” in the international expansion of GIC Re. A press release quoting Mr Chidambaram said, “It is our goal to make GIC Re a world-class reinsurer. It already offers reinsurance support to a 1,000 insurance companies”. The London branch is the second representat ive office of the reinsurer to be upgraded to a branch. Its Dubai office was upgraded to a branch in February 2007.

5. United Bank of India (UBI) proposes to launch what it calls ‘financial clinics’ one each in the four metros — Kolkata, New Delhi, Mumbai and Chennai — to push not only the bank’s own retail products but also mutual funds and insurance policies of other companies, and various other investment instruments. “However, the clinics will target mainly the elite customers; i.e. those who have at least Rs 1 lakh to spare, to advise them how to get the maximum value of their money and better returns.” Each clinic would be located in the bank’s respective regional office.

6. The BNP Paribas Group has injected around Rs 570 crore (€500 million) in its Indian operations in the recently concluded quarter.With this latest equity infusion, the capital base of the bank will be enhanced to Rs 1,600 crore, said a press release from the group.This is in addition to the group’s investment in various joint ventures in the country over the last three years.

7. Rise in retail prices of fuels could raise inflation from below 4%. In an indication that it may hold back a policy rate cut tomorrow, the Reserve Bank of India (RBI) on Monday said inflation in India was artificially “suppressed” as higher international oil prices have not been passed on to domestic consumers.

8. In a double whammy for two-wheeler makers, whose sales fell nearly 8 per cent in April-December last year, leading financiers have put their products in the high-risk category. The consequences have been dire. Leading outfits like ICICI Bank and HDFC Bank have raised the down-payment to 30 per cent — earlier, there were schemes against a down-payment of just Re 1 — and tightened lending norms, with the result that their exposure to two-wheelers has fallen nearly 20 per cent so far this financial year. Besides, finance companies are also trying to enforce belt-tightening at dealer outlets.

9. Bank of Baroda (BoB) will establish a wholly owned subsidiary in New Zealand to expand its footprint in the Asia-Pacific region. Initially, the public sector bank plans to pump close to $20 million (25 million NZD) in the new entity. BoB will first cater to the needs of the Indian diaspora in the New Zealand capital, Auckland, and then gradually expand its franchise and branch network. Operations will begin in early FY09. The bank is in the process of obtaining a ‘retail deposit taking’ banking licence from the Reserve Bank of New Zealand and completing other incorporation formalities. Fitch Ratings has assigned an expected long-term foreign currency issuer default rating of ‘BBB-’ (BBB minus) to proposed subsidiary in New Zealand.

10. National Housing Bank (NHB) is partnering US-based AIG United Guarantee, Asian Development Bank (ADB) and International Finance Corporation (IFC) to set up India’s first mortgage guarantee company. The company is likely to launch operations in March. According to the agreement arrived among the partners a few months back, NHB will hold 43 per cent stake, United Guarantee 41 per cent while ADB and IFC will hold 8 per cent stake each in the the joint venture company. “The shareholding requires internal approvals from each partner company. We will be approaching the Reserve Bank of India for registration after it releases the final guidelines for mortgage guarantee companies.”

Tides of 28.01.2008

1. The net profit of Federal Bank grew 22.7 per cent to touch Rs 102.92 crore for the third-quarter ended December 2007.The bank posted close to 50 per cent growth in interest and other income. Interest expenditure increased by over 67 per cent. The net interest margin was at 3.17 per cent and net interest income grew by 14 per cent.

2. Punjab National Bank (PNB) is in talks with Asset Reconstruction Company of India Ltd (Arcil) to shed some of its non-performing assets (NPAs) through this route. The bank is looking to pare its NPAs to one per cent of advances by end March 2008 from the level of 1.33 per cent as on end-December 2007.

3. The Asian Development Bank (ADB) will provide a $350 million loan to improve urban infrastructure and services in 31 towns and cities in Uttarakhand, which is one of the country's top tourist destinations. The Manila-based regional development bank has identified Uttarakhand as one of its priority States in India as its development was lagging behind other States. Improved urban services are needed to support tourism and industry - two economic sectors with substantial development potential in the State.

4. The accretion to the country’s foreign exchange kitty continued, as reserves increased by $3.169 billion to $284.898 billion, for the week ended January 19. The rise is mainly due to the central bank buying dollars in order to keep the rupee from appreciating as well as due to currency revaluation. The increase is less than the previous week’s rise of $5.47 billion, when the total foreign exchange reserves touched $281.73 billion.

5. Insurance fortnight is being observed in the Vishakapatnam branch of Dhanalakshmi Bank . It was inaugurated by Mr P. Krishna Prasad, of the Pydah Engineering College. He said the bank has tied up with Metlife for selling life insurance products and during the fortnight efforts would be made to make the customers aware of the necessity for insurance.

6. ING Vysya Bank’s net profit jumped 198 per cent for the third quarter of the current financial year to Rs 42.75 crore. The increase was partly driven by exceptional revenues of Rs 18.38 crore from sale of a non-banking asset. Gross profits in the third quarter were Rs 72.35 crore, up from Rs 21.32 crore.But gross revenues improved to Rs 528.06 crore from Rs 370.87 crore during the corresponding quarter of the last financial year. The improved gross revenues were driven by improved interest and fee-based incomes.

7. During the quarter ended December 31, 2007, UCO Bank posted a lower net profit of Rs 82.78 crore as compared to Rs 122.95 crore in the same period last year. It would attribute the drop to higher provisioning — Rs 22 crore in respect of some accounts which had been upgraded as per norm and another 34 crore on account of MAT. The operating profit during the period amounted to Rs 197.58 crore (Rs 231.38 crore).The net interest income amounted to Rs 378 crore (Rs 415 crore) and other income Rs 149 crore (Rs 113 crore). The treasury income was Rs 67 crore (Rs 24 crore) and fee-based income Rs 52 crore (Rs 46 crore). The net interest margin was 1.9 (2.42).

8. Taking a cue from the US Federal Reserve which cut the interest rates by 75 basis points, the Fedearation of Indian Chamber of Commerce and Industry and the Confederation of Indian Industry have urged the Reserve Bank of India to signal interest rates cuts by 25-50 basis points. “With inflation under control and hovering around three per cent, it is the right time for the RBI to cut repo and reverse repo rates that are currently at 7.75 per cent and six per cent respectively by 25-50 basis points to cover the relative competitive disadvantage India has on the macro economic fundamentals. “This move would strengthen the economic fundamentals and also boost investors’ confidence,” said the CII President, Mr Sunil Bharti Mittal, in a statement.

9.Punjab National Bank (PNB) plans to raise further capital of about Rs 1,500 crore before end-March to fund business growth. It will do it only through Tier-II capital as it has headroom there. It will not be through tier-I perpetual bonds. PNB has till date in the current fiscal raised Rs 1,100 crore through tier-I perpetual bonds. This includes the Rs 300 crore bonds raised last week at a borrowing cost of little over 9 per cent per annum.

10. Federal Bank opened its first overseas representative office in Abu Dhabi recently . The office was inaugurated by Mr Vayalar Ravi, Union Minister for Overseas Indian Affairs. Mr M. Venugopalan, Chairman of the bank, said with the opening of the office in the UAE, the bank would be providing single window facility to its NRI clients in the Gulf region. The UAE region also contributes 20 per cent of the deposit base of the bank at Rs 4,000 crore. “This is the first overseas effort of the bank to follow the customers to wherever they live. And moving closer to the customers has always been a top priority of the bank,” Mr K.S. Harshan, ED, said. With the introduction of the representative office closer to the NRI customers, the bank has targeted a growth in overseas business volumes of over 30 per cent from the region in the following years.

Tides of 17.01.2008

1. State Bank of Mysore (SBM) reduced its gross non performing assets (NPA) in the third quarter (Q3) of the current financial year (2007-08) by Rs 31 crore on a year-on-year basis.
Speaking to Business Line, SBM’s Chief General Manager, Mr Dilip Mavinkurve, said, “We upgraded some accounts under Corporate Debt Restructuring. Besides, this year we recovered close to Rs 100 crore including some big ticket accounts.” As a result the bank’s gross non performing assets dropped to 1.83 per cent of the gross advances, down sharply from 2.51 per cent of the corresponding period of the last financial year and 2.87 per cent from Q2 this year.
The recoveries buoyed SBM’s gross profits to Rs 136.15 crore in Q3, a 54 per cent increase over the corresponding period of the last financial year. Net profits grew 25 per cent during the same period to Rs 70.91 crore.

2. Spurred on by higher net interest income, LIC Housing Finance Ltd reported a 38-per cent increase in Q3 net profit at Rs 106.02 crore, against Rs 76.61 in the corresponding quarter of the previous year.

3. Spurred by the boom in the infrastructure sector, Infrastructure Development Finance Co (IDFC) has reported a 72-per cent increase in its net profit for the quarter ended December 31, 2007, to touch Rs 198.67 crore, as against Rs 115.15 crore last year.

4. Private sector general insurance companies improved their market share to 40 per cent, powered by the once shunned motor insurance business for the first eight months of the current financial year.According to the data released by the Insurance Regulatory and Development Authority (IRDA), private sector insurers’ gross premium accretions during the period was Rs 7,352.84 crore, a growth of 26.5 per cent over the corresponding period of the last financial year. Public sector insurers’ premium accretions for the same period were Rs 11,156.19 crore, or a growth of 3.81 per cent. The entire industry grew by only 11.77 per cent, during the period, implying that the bulk of the growth was cornered by the private sector companies.

5. United Bank of India will henceforth sell the export credit insurance products of the Export Credit & Guarantee Corporation of India Ltd through its network of branches. This follows the signing of a corporate agency agreement between the two organisations .

6. For the first time, Allahabad Bank will opt for perpetual bond to raise Rs 300 crore. “It is Tier I capital and we will issue it in the current quarter itself”, Mr A.C. Mahajan, CMD of the bank, told newspersons here on Wednesday. The bank’s Tier I capital, as a result, will rise to more than Rs 4,633 crore. The additional resources, as the CMD pointed out, would be needed to meet the increased demand for credit.

7. Grameen Capital India Ltd calls itself the ‘investment banker’ for the poor much like the Nobel Laureate, Dr Muhammad Yunus, called himself the banker of the poor.
The company, which launched its operations in Mumbai on Monday, is a joint venture in which Grameen Foundation, US and IFMR Trust hold 43 per cent stake each and Citicorp Finance India 14 per cent. The initial capital would be Rs 5 crore.Grameen Bank India will help micro finance institutions (MFI) gain wider access to domestic capital markets through securitisation and syndication of micro-finance loans, proactive engagement with rating agencies, and capital advisory services to MFIs for raising low-cost on-lending funds. It will offer IPO advisory and management services as well as help in private placement.

8. State Bank of Travancore (SBT) registered a 27.49 per cent rise in net profit during the first nine months of the current fiscal. For the nine months ended December 2007, the net profit was Rs 236.91 crore as against Rs 185.82 crore during the corresponding period in the last fiscal, says an SBT press note. This increase is mainly on account of a 27.17 per cent year-on-year growth in non-interest income, the release adds. SBT’s total income during the first nine months of the current fiscal touched Rs 2,811.84 crore as against Rs 2,147.22 crore in the corresponding period in the last fiscal. Total business touched Rs 61,241 crore in December 2007 as against Rs 53,644 crore at the end of December 2006. The gross NPA declined from 2.47 per cent in December 2006 to 2.14 per cent as of December 2007, while the net NPA declined from 1.26 per cent to 0.97 per cent.

9. Punjab National Bank (PNB) plans to raise Rs 300 crore through tier-I perpetual bonds on private placement basis this week, taking the overall amount mobilised in the current fiscal through this route to Rs 1,100 crore.The bank had raised Rs 500 crore through perpetual tier-I bonds in July 2007 at an annual coupon rate of 10.4 per cent. In December 2007, PNB had raised another Rs 300 crore through the same instrument, the annual borrowing cost for such bonds being lower than the 10 per cent level.

10. The banking system is being asked by the regulator, the Reserve Bank of India (RBI), to become more customer-friendly. The banks have been asked to consider a four-tier institutional machinery, covering all levels from the branch to the board, to improve standards of customer service. Inaugurating the 1001th branch of Vijaya Bank here on Monday, Mr V. Leeladhar, Deputy Governor of RBI, said that the institutional machinery within the banks in the area of customer service should comprise a customer services committee on the board, a standing committee on customer service, a nodal department or nodal official in the head office and each controlling office, and a branch-level customer service committee.

Tides of 14.01.2008

1. Indian Bank has reported a net profit of Rs 307.5 crore in the October-December quarter which is 61 per cent higher than the Rs 190.5 crore recorded in the comparable quarter of last year.A significant contribution came from ‘other income’, which rose 72 per cent to Rs 300.59 crore from Rs 175.1 crore earlier. It is learnt that the bank has settled “a long-standing big ticket NPA issue” and has received a substantial sum from it.

2. The State Bank of India has assured exporters that dollar transactions with Iranian buyers can be settled through its six correspondent banks in Iran. Following the US ban on large Iranian banks, SBI had not been accepting letters of credit from Iranian importers for the past couple of months.

3. Interest rates could soften by 25 basis points to 50 basis points if there is no hike in the cash reserve ratio, said Mr Deepak Parekh, Chairman, HDFC Bank, speaking to reporters on the sidelines of the Global Trade & Investment Conference of the Indian Merchants Chamber on Friday.
“India is a resilient economy but it is not completely immune to the global events. These global events will definitely affect us to a certain extent,” he said, addressing the conference. Mr Parekh said that India may not witness the flood of forex going forward as has been the case in the recent past because investors in India were cashing out and there was lot of redemption in the US.

4. The foreign exchange reserves rose by $ 696 million to touch $2.76 billion for the week ended January 4, due to an increase in foreign currency assets.The reserves had increased by $2.837 billion in the previous week ended December 28, 2007.

5. IT trade body Nasscom has partnered with ICICI Bank to float a closed-ended fund with an initial corpus of Rs 100 crore for investing in early stage companies and emerging technologies.

6. Certificate of Deposits issued by banks have vaulted over the past three years.The total amount of outstanding Certificate of Deposits (CDs) issued by banks in November 2007 stood at Rs 1,25,635 crore, around 80 per cent higher than Rs 67,694 crore in November 2006. That in turn was 130 per cent higher than the Rs 29,345 crore level at which it stood in November 2005. Market participants say that earlier only the nationalised banks and a few private banks were issuing CDs, but now many more banks are contributing to the increase in supply of CDs. They see its virtue in better balancing the maturity profile of their assets and liabilities .

7. Despite the rhetoric of financial inclusion, the top 100 centres in the country dominate in terms of credit and deposit.As per the ‘Quarterly Statistics on Deposits and Credit of Scheduled Commercial Banks – September 2007’ released by the RBI, today, the share of these centres has increased both year-on-year and sequentially from March 2007. The share of the top 100 centres in credit has gone up from 75.9 per cent in September 2005, to 76.7 per cent in September 2006 and to 77.2 in September 2007.

8. In an apparent bid to ensure that banking operations are not affected by the proposed countrywide strike by bank employees on January 25, the Centre has invited the representatives of the United Forum of Banking Unions (UFBU) and the Indian Banks’ Association (IBA) for conciliatory talks on January 22.

9. Contrary to popular belief, it was a public sector bank that walked away with the award for the best use of information technology in retail banking at the IBA & TFCI: Banking Technology Awards 2007, held on January 9, in Mumbai. Corporation Bank was the winner in this category, followed by Axis Bank as the runner-up.Awards were given for 15 different categories and the winners included a cross-section of banks such as public sector banks, foreign banks, private banks and even co-operative banks.

10. Catholic Syrian Bank has selected Sun Microsystems to implement its core banking solution (CBS) that will help customers access the bank’s services through the Web, branch or ATMs (automated teller machines).

11. The Catholic Syrian Bank has been observing the current financial year 2007-08 as ‘Relationship Year’ and as part of this program it has been opening ATMs at main tourist and pilgrim centres in the country.

12. Life Insurance Corporation of India plans to tie up with management institutes to offer its employees a special MBA programme.

Tides of 10.01.2008

1. The Institute of Financial Management and Research (IFMR) today launched the ‘IFMR Trust’. The Trust will “create and manage funds which will invest in commercial enterprises that leverage the competitive strengths of low income households.”IFMR already runs initiatives towards building channels to deliver financial and other services in rural remote locations. It has already invested around Rs 30 crore in seven commercial enterprises focussed on low income households and expects to raise the investments to Rs 600 crore by March 2009.

2. Banks must implement strong IT governance practices to ensure that that their technology projects do not adversely impact their performance, according to senior bank officials at Banknet’s “Fourth International Conference on Payment Systems,” held here on Wednesday.
Strong information technology platforms call for calculated and discrete measures from banks. “Banks are faced with two major risky propositions – the pace at which their businesses are growing and the pace at which technology changes,” according to Mr Ravikiran Mankikar, Chief Technology Officer, Shamrao Vithal Co-operative Bank. This makes it imperative for banks to have strong wraps of governance surrounding their IT practices.

3. South Indian Bank (SIB) has recorded a 64 per cent increase in net profit during the third quarter of the current year as compared to the corresponding period of the previous year.
The net profit was Rs. 40.72 crore for the 3 month period ended December 31, 2007, as against Rs. 24.84 crore last year.

4. Higher interest income and better net interest margin enabled Axis Bank to report a 66 per cent growth in its net profit for the third quarter ended December 31, 2007.The net profit increased to Rs 306.83 crore from Rs 184.61 crore in the corresponding quarter of the previous year.

5. Grappling with issues of change management, innovation for new delivery channels and broadening the range of services portfolio — both internal and external, the banking sector in the country, like its peers across the world, is taking to business transformation solutions.With the Indian banking sector poised to open up further by welcoming global competition, consolidation has gained momentum. This now means that the large banks, with disparate systems, cannot any longer assume that the current rate of growth and returns will continue given the nimbleness of some of the new players and the likely competitive environment in the financial services business.

6. The Indian banking sector is at a watershed. Brisk economic growth is opening up unprecedented opportunities. Several Indian banks are pursuing global strategies, as Indian companies globalise and people of Indian origin increase their investment in India. At the same time a number of global banks have stepped up their focus on India, keen to participate in the sector’s growth. Today, the question often asked is how competitive are Indian banks and do the practices at work in these banks compare against global best practices. To assess this, McKinsey & Co launched five proprietary surveys with help from the Indian Banks Association to profile leading Indian banks. The surveys administered were The McKinsey Personal Financial Services Survey; Excellence in Retail Banking Survey; IT Benchmarking Survey; Organisational Performance Profile Survey; and Asset-Liability Management Survey.

7. Raise a question on size to any of the old private bank chiefs, and all of them defend their space strongly. The common refrain – “We too have a role to play. We cater to a niche segment and there is room for growth. A vast majority of our populace still remain unbanked, under-banked. Small-size banks exist even in developed economies.”

8. Lakshmi Vilas Bank today announced the roll out of its 200th CBS branch. It has a branch network of 236 across 11 States and one Union Territory. The bank plans to unveil technology-driven products and multi-city cheque facility soon, besides providing Internet and mobile banking facility.According to a press release, the RBI has permitted the bank to open 15 new branches across the country by May 2008.

9. Exim Bank of India has entered into a line of credit (LoC) agreement for $45 million with the Government of Vietnam to finance construction of a power project in Vietnam. Bharat Heavy Electricals Ltd will construct the 200-MW Nam Chien Hydropower Project, at Son La Province. This is the second line of credit extended by Exim Bank to Vietnam, said a press release from the bank. The first LOC of $27 million was utilised to finance export contracts such as supply of equipmen t for cold rolling steel plan, hydropower plants, tea processing machinery and textile machinery from India to Vietnam.

10. Loss levels in small ticket personal loans and a portion of credit card receivables, which are currently at 7-9 per cent, could rise to 10-13 per cent in three years, said a report by Crisil Ratings.Terming this segment as ‘sub-prime’ assets in the Indian context, the report said that these are unsecured loans between Rs 5,000 and Rs 25,000-30,000. Of the total credit card receivables, about 15-20 per cent falls in the profile of low income groups.

Tides of 4.01.2008

1. An analysis of US dollar return data shows that Indian bourses have delivered the third highest gain of 71.23 per cent during last year.

2. Long distance transfers of peons and sweepers in the Industrial Development Bank of India (IDBI) has created unrest among the employees, who have challenged the transfer policy by threatening to go on an indefinite strike. The crisis erupted 13 months after the merger of erstwhile United Western Bank (UWB) with the IDBI. The union alleged that the bank is resorting to transfers in order to compel the former UWB employees to submit resignation.

3. Strategic alliance between Oriental Bank of Commerce, Indian Bank, and Corporation Bank is not progressing as was envisaged, and change of guard at the top level is responsible for this, officials familiar with the development said. Christened as OIC, the alliance that was launched in 2006 has made very little progress in the last one year and a half. The tie-up was touted as an alternative to mergers among Indian public sector banks. The alliance had planned several new initiatives such as forging a joint venture for credit card business, jointly opening subsidiary abroad, among others. All these plans have taken a backseat now. “All these banks are small ones, which are chairman driven and not system driven. Change in the top management of some of the partners has affected progress of the alliance,” the official said. The idea of having a common OIC logo for the alliance has also been scrapped.

4. United Bank of India (UBI) has committed an investment of Rs 250 crore on information technology for the next financial year. The investment will cover a massive roll out of core banking solutions (CBS), on line share trading facility, phone banking and cash management services among others.

5. Corporation Bank informed the Bombay Stock Exchange on Tuesday that its total business had crossed Rs 83,000 crore in the ongoing financial year, growing at 22 per cent on year. The bank’s total deposit grew 24% to over 490 bln rupees and total credit grew 20 per cent to over Rs 34,000 crore.

6. Public sector Indian Bank is set to provide more thrust to meet financial requirements of the urban poor formed as Self Help Groups (SHGs) with the opening of three more ?Microsate' (a satellite.

7. The New Year is likely to bring in good news for borrowers as interest rates on home and consumer loans could decline from the second quarter onward, but high fuel and food prices might play spoilsport by putting pressure on inflation, bankers and economists feel. Experts feel that interest rates have peaked and with deposit rates on the decline, consumers could see softening of interest rates in 2008 as the prudent stance of the Reserve Bank of India for almost the whole of last year managed to keep inflation low without disrupting economic growth.

8. Banks want their investments in company shares and debentures, loans and guarantees given to corporates as part of normal business activities, to be excluded from transfer pricing norms.

9. Reliance Banking Fund, an open-ended scheme from Reliance Mutual, topped the returns chart in 2007 in the banking funds' category, posting nearly 77 per cent returns.

10. Property transactions in India will soon have an insurance cover to fall back in case something goes wrong in the deal. The country’s two large private sector insurers, ICICI Lombard General Insurance and Bajaj Allianz General, are planning to launch title insurance covers this year. Title insurance is a cover that protects a potential owner of a property against loss from defects in title. The policy is a retrospective one, where the insured is protected against losses arising from the events that occurred prior to the date of issuing the policy. Globally, the policy is bought by investors, occupiers and financiers. At present, none of the property transactions, be it large acquisitions or a simple sale of a land or a flat, is covered through an insurance policy by an Indian insurer.

Tides of 3.01.2008

1. Corporation Bank will be opening 100 new branches in the calendar year 2008 with focus on western and northern regions of the country.

2. In a bid to stimulate credit offtake in the peak seasons, banks are preparing to offer discounts to their respective benchmark prime lending rates (BPLR).Currently, only highly rated corporates are raising bank funds at discounts to the BPLR, that currently ranges 12.75 per cent to 13.5 per cent. The discounts, even for these corporates, are barely about 100 basis points. Yet despite the discounts, the average cost of borrowings was close to 11 per cent.

3. State Bank of India has entered into an alliance with India Post in Kerala for making available some of its services to the public in financial inclusion.

4. Weekends are the time to relax for most officials. But not for a couple of officials in Bank of Maharashtra and for farmers in Amaravati and Yavatmal districts. It is the time for them to discuss issues related to better agriculture practices where experts provide technical inputs on various aspects. In its endeavour to provide counselling to the farmers in Vidharbha region (which grabbed headlines for farmers’ suicides), Bank of Maharashtra thought of going beyond extending financial assistance to them, and it came out with an idea of providing technical inputs to farmers in the drought-affected Vidharbha region. The bank initiated the process of organising counselling programmes for farmers in Amaravati district of Maharashtra in May 2007.