HDFC BANK RAISES FIXED DEPOSIT RATES BY UP TO 75 BASIS POINTS

HDFC Bank became the first lender to increase its fixed deposit rates by up to 75 basis points after RBI raised key short-term rates.

With deposit rates going up, the bank may also raise lending rates in the next few weeks, a bank official said. 

The revised fixed deposit rates would be effective from July 30

Term deposit rate with maturity in between 91 days and 6 months would be raised by 75 basis points to 5.25 per cent from the existing 4.5 per cent.

For fixed deposit in between 9 months and one year, the new rates would be higher by 50 basis points at 6.25 per cent while for 1 year 16 days category it will be 7 per cent, 25 basis points more than the existing rate of 6.75 per cent.

Another private sector lender Lakshmi Vilas Bank also increased its fixed deposit rates up to 50 basis points across various maturities. The new rates would be effective from August 2.

The term deposit rate for 181-270 days has been raised by 50 basis points to 6.25 per cent from 5.75 per cent.

At the same time, 271-364 days term deposit would attract an interest rate of 6.5 per cent compared to existing 6.25 per cent while 1 year to less than 2 years deposit would also go up by 25 basis points.

Source: http://economictimes.indiatimes.com/news/news-by-industry/banking/finance/banking/HDFC-Bank-raises-fixed-deposit-rates-by-up-to-75-basis-points/articleshow/6228092.cms

LIQUIDITY PRESSURE LIKELY TO EASE NEXT WEEK: RBI

The Reserve Bank of India (RBI) said that it expects the tight money supply condition, created by the huge outgo towards payment on spectrum by telcos, to ease by next week.

RBI's statement came a day after the central bank decided to refrain from sucking out liquidity from the system, even as it took other steps to rein in high inflation.

Reserve Bank had refrained from raising the cash reserve ratio (CRR), a requirement for banks to keep cash with the central bank, as the liquidity is already tight in the system.

This was done despite the RBI raising concerns over high inflation and upping its key short-term rates.

The system faced shortage of money supply after over Rs 1 lakh crore went out of the system as telcos made payments towards acquiring spectrum for high-speed telecom and broadband services and corporates made advance tax payments.

Source: http://www.business-standard.com/india/news/liquidity-pressure-likely-to-ease-next-week-rbi/103181/on

HDFC BANK HIKES FD RATES BY UP TO 0.75%; LOANS TO BE DEARER

A day after Reserve Bank of India (RBI) tightened the monetary policy, leading private sector lender HDFC Bank decided to raise deposit rates by up to 0.75 per cent.

The deposit rate hike by HDFC Bank and similar plans by other banks, would translate into a hike in lending rates soon making auto, home and commercial loans more expensive.

State Bank of India (SBI) too indicated that it could raise its deposit rates by at least 0.25 per cent in August-September, even as smaller lender Lakshmi Vilas Bank announced increasing deposit rates by up to 0.50 per cent.

While HDFC Bank will provide higher rates to its depositors from July 30, Lakshmi Vilas Bank will hike rates from August 2.

HDFC Bank will offer 5.25 per cent interest, up from 4.5 per cent, on fixed deposits between 91 days and 6 months and 6.5 per cent (existing 5.75 per cent) between nine months and one year.

Although the higher rates would increase the returns for depositors, they would increase the cost of funds for the banks which will ultimately be neutralised by charging higher rates from loan seekers.

Source: http://www.business-standard.com/india/news/hdfc-bank-hikes-fd-rates-byto-075-loans-to-be-dearer/103179/on

RBI ANNOUNCES MONETARY MEASURES

On the basis of the current assessment and in line with the policy stance, the Reserve Bank announces the following policy measures:

Bank Rate

The Bank Rate has been retained at 6.0 per cent.

Repo Rate

It has been decided to:

increase the repo rate under the Liquidity Adjustment Facility (LAF) by 25 basis points from 5.5 per cent to 5.75 per cent with immediate effect.

Reverse Repo Rate

It has been decided to:

increase the reverse repo rate under the LAF by 50 basis points from 4.0 per cent to 4.50 per cent with immediate effect.

Cash Reserve Ratio

The cash reserve ratio (CRR) of scheduled banks has been retained at 6.0 per cent of their net demand and time liabilities (NDTL).

Expected Outcomes

Monetary policy actions are expected to:

Ø      Moderate inflation by reining in demand pressures and inflationary expectations

Ø      Maintain financial conditions conducive to sustaining growth

Ø      Generate liquidity conditions consistent with more effective transmission of policy actions

Ø      Reduce the volatility of short-term rates in a narrower corridor.

       

Mid-Quarter Review of Monetary Policy 2010-11

The next mid-quarter review of Monetary Policy for 2010-11 will be announced through a press release on September 16, 2010.

Second Quarter Review of Monetary Policy 2010-11

The second quarter review of Monetary Policy 2010-11, including developmental and regulatory policies, is scheduled on November 2, 2010.

Source: http://www.rbi.org.in/scripts/NotificationUser.aspx?Id=5903&Mode=0

FIN MIN APPROVES PUNJAB & SIND BANK IPO

The government has approved an initial public offering of shares in state-run Punjab & Sind Bank, Finance Minister Pranab Mukherjee told the parliament on Tuesday.

Source: http://www.business-standard.com/india/news/fin-min-approves-punjabsind-bank-ipo/102934/on

PAPER ON NEW BANK LICENCES BY AUG: SUBBARAO

According to Mr. D. Subba Rao, Governor, RBI, it will come up with a discussion paper on granting banking licence to private sector players and NBFCs by the first week of August.

"There has been a number of issues that has come up as to what should be the entry level capital, promoters' capital, norms for corporates and NBFCs," Subbarao said.

Business houses including the Anil Ambani Group, the AV Birla Group, Bajaj Auto and Religare among others have evinced interest in acquiring banking licence. NBFCs like Shriram Group and Srei are also keen on entering the banking space.

Source: http://www.business-standard.com/india/news/papernew-bank-licences-by-aug-subbarao/103016/on

DENA BANK EXPECTS 6 BN RUPEES INFUSION FROM GOVT IN FY11

Dena Bank expects an infusion of 6 billion rupees from the government in FY11, D.L. Rawal, chairman and managing director, told reporters on the sidelines of an earnings press conference on Monday.

The bank has sought 13 billion rupees of capital from the federal government over the next 3 years to meet loan growth targets.

Source: http://economictimes.indiatimes.com/news/news-by-industry/banking/finance/banking/Dena-Bank-expects-6-bn-rupees-infusion-from-govt-in-FY11/articleshow/6218980.cms

INDIAN OVERSEAS BANK RAISES RS 500 MN VIA CDS

Indian Overseas Bank on Monday raised 500 million rupees via certificates of deposit (CDs), a day before the central bank reviews policy.

Source: http://economictimes.indiatimes.com/news/news-by-industry/banking/finance/banking/Indian-Overseas-Bank-raises-Rs-500-mn-via-CDs/articleshow/6220308.cms

IDBI BANK GETS RS.3119 CR. AID FROM GOVT

IDBI Bank said that it has received a capital infusion of Rs 3,119.04 crore from the government. The capital infused through preferential allotment of shares to the Government of India would augment capital adequacy.

Under the scheme, the government would buy 25.95 crore equity shares at Rs 120.19 a piece as part of its planned capital support to banks.

Approval in this regard was accorded by shareholders at the sixth AGM of the bank last week, which is subject to allotment of the shares in terms of the prescribed statutory and regulatory formalities, IDBI Bank said in a statement.

The government currently holds 52.6 per cent stake in the bank. Post-capital infusion, the stake of the Central Government would go up to 65.15 per cent.

Source: http://www.business-standard.com/india/news/idbi-bank-gets-rs-3119-cr-aidgovt/102890/on

AIBOC CIRCULAR NO. 106 DATED 24.07.2010

AIBOC issued its circular No. 106 on implementation of 2^nd option on pension and the hurdles of litigation in implementation of the agreement. We are reproducing the same here for our readers.

CIRCULAR NO:106                    DATE: 24.07.2010

TO ALL AFFILIATES/MEMBERS:

2^ND OPTION ON PENSION – IMPLEMENTATION OF AGREEMENT HURDLES OF LITIGATION ETC.

We have been receiving anxious enquiries from the entire bank officers’ fraternity all over the country as to the process of the implementation of the 2^nd option on Pension as agreed at the industry level between the Constituents of the United Forum of Bank Unions and the Indian Banks’ Association.  Our comrades may recollect that, the issue was being pursued by the Confederation and it was taken up with the Indian Banks’ Association as well as the Government authorities for speeding up the entire process of issuance of notification and extension of offer of the scheme as required under the agreement. However, in the meanwhile, some of the CPF Optees have approached the Hon’ble High Court of Madras for bringing stay on the grounds that the contribution of 2.8 times of the “pay” as on 01.11.2007 as per the agreement dated 27.04.2010 by the P.F.Optees alone is discriminatory and hence the Court should stay the operation of the agreement.  The Court has granted a temporary stay on 29.06.2010 against recovery of 2.8 times of pay from the arrears of salary and allowances from CPF optees subject to the hearing of the case.

The case is getting listed but could not reach the stage of hearing so far.  We have been in touch with the Indian Banks’ Association and the Government authorities for early moving of the court to get the matter resolved so that the implementation of the agreement can be smooth one.  Unfortunately, there are certain developments in between. The payment of arrears in Canara Bank took place after the temporary stay was granted by the Court; the petitioners have raised the issue of contempt of court and compelled the Management of Canara Bank to refund the amount recovered. Fearing the contempt proceedings Bank has returned the amount recovered from the award staff.  As the Confederation or any other Officers’ organization is not a party to this petition, they have not returned the amount recovered from the Officers concerned.

It is in this background we have taken up the matter with the IBA for immediate action on their part.  We are now given to understand that in view of the inordinate delay and the frustration it is causing to the entire workforce, the IBA is now planning to go before the Bench of Hon’ble High Court of Madras, raising the issue of urgency in getting the agreement implemented and seeking quashing of the case.  We are confident that the issue is expected to be sorted out by the end of next week.

We are in touch with the Convener of United Forum of Bank Unions and he is also seized of the matter and had a detailed discussion with the Indian Banks’ Association. We have also decided to raise the issue in the meeting of the United Forum of Bank Unions which is scheduled on 26^th of July 2010 at Mumbai to deliberate on all these developments and take appropriate decision in the matter.

We have been receiving a number of communications and anxious enquiries from different parts of the country.  Our affiliates should keep a close watch about these developments and should ensure that the interests of the Officers are protected.  If there are any unsavory developments they should be in touch with the leadership of the Confederation for necessary guidance.  They should also convey to their respective management that as regards the Officers the status will continue and there is no question of return of the contribution.

We note to keep advised of further developments in the matter.

With greetings,

Sd/-

(G.D. NADAF)

GENERAL SECRETARY

AIBOC CIRCULAR NO. 105 DATED 24.07.2010

AIBOC issued its circular No. 105 on payment of subsistence allowance to Officers kept under suspension. We are reproducing the same here for our readers.

CIRCULAR NO: 105                             DATE: 24.07.2010

TO ALL AFFILIATES/MEMBERS:

OFFICERS KEPT UNDER SUSPENSION PENDING DEPARTMETNAL ENQUIRY - PAYMENT OF SUBSISTENCE ALLOWANCE

We have addressed a letter to IBA to release the subsistence allowance to officers on the same pattern as in case of workmen and also extend the benefit of salary revision or increase in salary etc., during the period of suspension.

We enclose a copy of our communication for your information.  We shall advise the outcome in due course.

With greetings,

Sd/-

(G.D. NADAF)

GENERAL SECRETARY

No. /1452/220/10                                  22nd July, 2010

To,

The Chairmen.

Indian Bank  Association

World Trade Centre  Complex,

Centre 1, 6^th Floor, Cuffe parade,

Mumbai- 400 005

Dear Sir,

OFFICERS KEPT UNDER SUSPENSION: PENDING DEPARTMENTAL ENQUIRY

The Management may suspend an officer employee against whom disciplinary action is contemplated or enquiry is pending. The employer has to exercise this power when grave charges of misconduct such as serious act of omission or commission are alleged against the officer employee.  Under such circumstances the Management resorts to such steps to keep the officer employee out of mischief’s range or to deny the officer employee to have access to materials, records, evidence which have a bearing on the gamut of charges leveled against the officers.

But, of late we have been observing that the Managements are not exercising this power with due caution and care and application of mind. Officers are suspended without making a fair and proper assessment of the matter in the given circumstances, without carefully scrutinizing that prima facie there exist grave and compelling circumstances which in the light of material available and collected during the preliminary investigation, lead to likely removal of the employee from service of the bank. In most of the cases the officer employees are suspended from the service of the bank as a punitive action; though it is not penalty technically, causing great hardship, harassment, mental agony to the concerned.

The suspended officers are eligible for payment of subsistence allowance during the period of suspension.  But, no uniform policy is followed as regards rate of the subsistence allowance.  In case of workmen the managements have been considering the following:-

• 50% of the Salary & Allowances for the first six months.
• 75% of the Salary/Allowances for the next six months.
• 100% of the Salary/allowances will be restored after completing one year i.e. full wages.

If there is any revision, increase in the salary, the revision or increase will be extended to the employee proportionately.

If an anniversary increment is due during the period of suspension, the same will be granted to the workmen.

In respect of officer employees the subsistence allowance is restricted to 50% of the salary, allowances etc., at the time of imposing the suspension. The suspended officers are denied the other benefits available to the workmen, thus causing him hardship and harassment.

Moreover, the officer employees are not given the benefits of salary revision or increase in pay scales during the period of suspension.  This we feel is against the principles of natural justice and putting the officers in a totally disadvantageous position vis-à-vis the workmen.  This amounts to punitive action, which in effect will be punishment to the suspended officer-employee.

In this background, we have a strong feeling that the rules for keeping the officer employees under suspension need a review and we request you to take note of our following suggestions and consider the same positively.

• Restore the salary and allowances on the same line as in the case of workmen
• Extend the benefits of salary revision increase, increments on the anniversary date falling during the period of suspension.
• Steps should be initiated for completing the enquiry within the shortest possible time frame.

We, therefore request you to arrange for a meeting to deliberate on the above vexatious issue and enable us to present our views on the issue.

Thanking you,

Yours faithfully,

Sd/-

(G.D. NADAF0

GENERAL SECRETARY

AIBOC CIRCULAR NO. 104 DATED 24.07.2010

AIBOC issued its circular No. 104 on the venues for the Silver Jubilee Celebrations Valedictory Function to be held at Delhi on 22^nd and 23^rd October 2010. We are reproducing the same here for our readers.

CIRCULAR NO. 104                                   DATE:24.07.2010

TO ALL AFFILIATES /MEMBERS

AIBOC-SILVER JUBILEE CELEBRATIONS VALEDICTORY FUNCTION AT DELHI

Please refer to our Circular No. 96, dated 12.06.2010

Following are the venues for National Seminar and Valedictory Function of the Silver Jubilee Celebrations

NATIONAL SEMINAR ON 22^ND OCTOBER, 2010 AT 5.30 PM

SRI SATHYA SAI INTERNATIONAL CENTER,

PRAGATI VIHAR, LODHI ROAD, NEW DELHI 110 003

(Opp. Sai Baba Temple)

SILVER JUBILEE FUNCTION ON 23^RD OCTOBER, 2010 AT 5.00PM

SWARAN JYANTI AUDITORIUM

LADY HARDING HOSPITAL, CONNAUGHT PLACE, NEW DELHI -110 001

(Opp. Shivaji Stadium)

We shall advise the venue of our Special Executive Committee Meeting to be held on 23.10.2010 at Delhi,later.

With greetings

Sd/-

(G.D. NADAF)

GENERAL SECRETARY

NEW BANKS MAY HAVE TO REACH OUT TO RURAL INDIA

Would-be banks seeking a licence may be asked to form alliances with regional rural banks (RRBs) to help them begin operations on a wider footprint, as also to hasten financial inclusion.

Reserve Bank of India (RBI) is likely to set a condition that new banks open a certain minimum number of branches in unbanked areas, according to an official. The central bank is scheduled to finalise draft guidelines for new bank licences this month and some bankers expect these to be announced with the quarterly monetary policy review on Tuesday.

RBI plans to consider granting licences to private sector players and non-bank finance companies to promote new banks. It may selectively permit some large business houses with diversified sources of income and a stable track record.

The central bank may not be enthused to let in securities’ firms because of the volatility in their earnings and market capitalisation. The confidence of depositors could get shaken if income and profits of these firms get eroded, as was witnessed during the global economic downturn in 2008 and early-2009.

An internal committee of RBI is working on the guidelines. The minimum required capital may be set at Rs 500 crore initially, with a provision that it be raised to Rs 1,000 crore by the third year. There is a growing capital requirement if the economy has to grow faster than the 8.5 per cent it aims for the year to March 2011. Foreigners may be permitted to invest up to 20 per cent, the sources said.

“Banks in India will need about $25 billion over the next five years to meet credit, financial inclusion and Basel-2 requirements,’’ said Ashvin Parekh, partner and national leader, global financial services, Ernst & Young.

Source: http://www.business-standard.com/india/news/new-banks-may-have-to-reach-out-to-rural-india/402494/

PAY PARITY BETWEEN RRB AND PSU BANK EMPLOYEES

 Government asked regional rural banks (RRBs) to introduce revised pay structure for their employees on par with PSU banks from November 1, 2007, which will cost them Rs 791 crore on arrears payment and plunge more of them into losses.

The additional cost on payment of arrears will bring down the total profits of the RRBs from Rs 2,374 crores during 2009-10.

This is likely to lead to more RRBs going into losses against only three loss making RRBs at present. Yet the Government is committed towards fulfilling its obligation of giving equal pay scales corresponding to those of nationalized banks to the RRB employees," Mr. Pranab Mjukherjee, Finance Minister said.

Currently, the country has 82 RRBs with over 68,000 employees.

The Finance Minister also asked 49 RRBs regional Rural Banks (RRBs), which have more than five per cent of non-performing assets, to bring down their bad debts below below 5 per cent by this year itself.

Stressing on their role towards financial inclusion, he called upon RRBs to speed up their activities to expand their branches on platform of Core Banking Solutions.

Mukherjee asked them to use new technology including mobile banking vans, tele-banking to provide banking services to entire population of the country, especially in the rural areas.

Source: http://economictimes.indiatimes.com/news/news-by-industry/banking/finance/banking/Pay-parity-between-RRB-and-PSU-bank-employees/articleshow/6216267.cms

NPAS OF BANKS TO RISE THIS FISCAL: FINMIN

Financial Services Secretary, Ministry of Finance said gross bad debts of commercial banks are likely to rise this fiscal from over 2.5 per cent in 2009-10 due to slippage in loans restructured due to the impact of global economic slowdown.

He also said short-term borrowing by banks from RBI indicates that the system is facing tight liquidity, which many experts say will not allow RBI to tighten money supply in its monetary review on Tuesday.

Earlier, ratings firm Standard and Poor's had expected 25-50 per cent of loans restructured by Indian banks to slip to non-performing assets in the next two years.

According to CARE Rating Agency data, top 12 banks had restructured assets worth Rs 32,530 crore, taking their total restructured assets to nearly Rs 73,000 crore.

Source: http://economictimes.indiatimes.com/news/economy/finance/NPAs-of-banks-to-rise-this-fiscal-Finmin/articleshow/6216172.cms

103 US BANKS COLLAPSE IN UNDER 7 MONTHS

The count of bank failures in the US has crossed the century-mark in 2010 and as many as 17 entities have folded up so far this month.

Mostly small and medium banks are bearing the brunt of the collapse, as they continue to wobble under the prolonged sluggishness in financial conditions. On an average, nearly 15 banks have bit the dust every month so far this year.

According to the Federal Deposit Insurance Corporation (FDIC), which insures deposits at over 8,000 banks, as many as 103 entities have gone out of business so far this year. In 2009, a staggering 140 banks were shut down.

On July 23 alone, authorities seized seven banks which would result in an expense of about USD 431 million for the FDIC.

Source: http://www.financialexpress.com/news/103-us-banks-collapse-in-under-7-months/651453/

RBI SAYS CAN'T RELAX DISTANCE NORM FOR BUSINESS CORRESPONDENTS

Reserve Bank of India has declined to accept a proposal from an Inter-Ministerial Group (IMG) to relax the stipulation that business correspondents (BC) should be within 30 km distance of a branch.

The RBI will also bring out a paper to discuss whether or not to allow profit-making organisations, including mobile service providers, to become business correspondents.

This was revealed at the first meeting of the monitoring group chaired by the Cabinet Secretary to consider the recommendations made by the IMG on usage of mobile phones to deliver financial services.

The IMG had suggested simplified know-your-customer (KYC) requirements and permitting “for profit” corporate entities to function as BCs. The IMG report was accepted by the Committee of Secretaries in April after which the Prime Minister had directed the constitution of a monitoring group to oversee implementation of the project.

In the first meeting of this monitoring group, the RBI said the proposal to allow BCs beyond 30 km distance could not be accepted due to supervisory reasons.

The banking regulator, however, added that it was not suggesting that banks open a full-fledged branch but only insisting minimal administrative presence within 30 km range to monitor BCs. On allowing for-profit entities to functions as BCs, the RBI informed that it was preparing a concept paper for public comment and a final decision will be taken by August.

With regard to relaxing the KYC norms, the RBI informed that it has written to the Department of Revenue to make changes to the list of documents required for opening an account to include the identity card issued by State Governments under NREGA.

On the issue of fixing the transaction charges payable to each stakeholder in the system, it was decided that the RBI committee, which is looking into other issues linked to this project, should fix a cap taking into consideration issues of affordability to users while also enabling the players to recover their costs.

It was also decided to set up another IMG under the Secretary, Rural Development, that would work out the process for crediting Government payments by various departments into the no-frills accounts set up under the project.

Source: http://www.thehindubusinessline.com/2010/07/26/stories/2010072652090100.htm

‘PUBLIC SECTOR BANKS SHOULD FOCUS ON LEADERSHIP SKILLS'

Ms. Renu Challu, Managing Director, State Bank of Hyderabad in an interview given to Businessline has said that Public Sector Banks should focus on leadership skills.

“The expectations of public sector banks are very high. Hence the leadership in banking needs to be a little different. One needs to be self-motivated and should be able to identify the right people for the right tasks,'' says Renu Challu.

“Leadership development is not easy in banks as there are regulatory issues, operational assignments and credit assessments. While foreign and private banks have different verticals, managers in public sector banks do not enjoy this luxury,'' she says.

As PSBs have been on a hiring spree in recent years, inducting about 40,000 officers and clerks every year, a special focus on improving leadership skills is required, feels Challu.

“In a bank, the staff at all levels needs to connect with the outside world. This should be practised by those in leadership roles, so that their example can be emulated by their team members,'' she suggests.

Source: http://www.thehindubusinessline.com/manager/2010/07/26/stories/2010072650191100.htm

UBI NET PROFIT UP 53.5%

United Bank of India (UBI) post a 53.50 per cent rise in net profit for the quarter ended June 2010 to Rs 107.86 crore, against Rs 70.28 crore in the same period last year.

Although the bank saw fresh slippages of 248 crore in the last quarter and treasury income fell almost 50 per cent over the corresponding quarter last year, it saw net interest income increase by about 93 per cent to about Rs 508 crore.

The bank’s treasury income fell to Rs 31.75 crore in the quarter under consideration, from Rs 61.20 crore in the first quarter of last year.

According to Mr. Bhaskar Sen, Chiarman and Managing Director, UBI, the increase in profitability was primarily due to restrictions on interest outflow, which was almost flat on a year-on-year basis. In the June 2009 quarter, the interest outflow was Rs 926 crore, which increased to Rs 928 crore in June 2010. The marginal 0.24 per cent rise was on account of the cost of borrowing.

The cost of deposits for the bank came down to 5.40 per cent in the April-June quarter, from 6.47 per cent in the quarter ended June 2009.

The bank’s provision coverage ratio stood at about 68 per cent in the first quarter of the present financial year, and the bank would need another Rs 50 crore to reach the 70 per cent mark mandated by the Reserve Bank of India.

The bank’s net interest margin in the last quarter was 2.98 per cent, against 1.90 per cent in the same period last year.

UBI’s capital to risk (Weighted) assets ratio (CRAR) in the quarter ended June 2010 was 12.99 per cent, against 13.18 per cent in the same period last year.

Source: http://www.business-standard.com/india/news/ubi-net-profit535/402375/

INDIAN BANK POSTS 11% GROWTH IN NET PROFIT

Indian Bank reported an 11 per cent rise in net profit to Rs 368.15 crore for the first quarter ended June 30 as compared to Rs 331.66 crore during the corresponding quarter of the last financial year. The bank posted a 11.07 per cent increase in total income at Rs 2,477.25 crore, as against Rs 2,230.39 crore in the same period last year.

Indian Bank’s revenue from the corporate banking segment went up by 19.67 per cent to Rs 1,041.37 crore, from Rs 870.20 crore in the year-ago period.

Mr. T M Bhasin, chairman and managing director, Indian Bank, said the bank’s current account, savings account (CASA) base rose to Rs 29,750 crore in June 2010 from Rs 22,957 crore during the same period last year. CASA share improved to 33.34 per cent in the first quarter of 2010-11, from 30.39 per cent a year ago.

The bank’s net interest margin (NII) growth would remain healthy at 24 per cent, he added

Source: http://www.business-standard.com/india/news/indian-bank-posts-11-growth-in-net-profit/402374/

BANKS CAN OPEN MOBILE BRANCHES SANS RBI NOD

Reserve Bank of India allowed commercial banks to open mobile branches without its approval in areas with less than 50,000 population, in a major step toward bringing about financial inclusion of the unbanked sections of the society.

It has been decided to further liberalise the branch authorisation policy and grant general permission to domestic scheduled commercial banks (other than RRBs) to operationalise mobile branches in tier 3 to tier 6 centres (with population up to 49,999 as per Census 2001) subject to reporting.

  The mobile branch scheme envisages extension of banking facilities through a well protected van with arrangements for two or three officials of the bank sitting in it with books, safe containing cash etc.

The mobile branch would visit the places proposed to be served by it on specific days. However, it should not visit the villages or centres which are served by co-operative banks and places served by regular branch of commercial banks.

It should be stationed in each location for a reasonable time on specified days and specified hours, so that its services could be utilised properly by customers. The business transacted at the mobile branch shall be recorded in the books of the base branch or data centre.

Further, it has been decided to grant general permission to scheduled commercial banks (other than RRBs) to operate mobile ATMs at places identified by them, without prior permission from the Reserve Bank.

Source: http://economictimes.indiatimes.com/news/news-by-industry/banking/finance/banking/Banks-can-open-mobile-branches-sans-RBI-nod/articleshow/6207011.cms