CIBIL is watching you!

November 27, 2011 - DC

If you are a user of multiple credit cards or making delay in your payments, beware! Credit Information Bureau (India) Ltd is watching and rating your credit history. In an exclusive interview with Bijith R., Mr Arun Thukral, the managing director of CIBIL, spoke about the need for an individual to maintain financial discipline, how it impacts his credibility and how banks are increasingly looking at an individuals credit score while lending loans.

Excerpts:

When does an individual enter CIBIL records?

CIBIL captures the entire history of an individual, which is shared by the bank or credit grantor. So if an individual has taken a loan, then he beco-mes part of the credit bur-eau. And CIBIL captures the database on a monthly basis and brings out a comprehensive report. So far we have over 200 million records in the bureau.

How is an individual’s credit scorecard prepared and what does it indicate?

There are 258 variables built into an algorithm, which generates score in the band of 300 and 900. If your score is near 300, the possibility of you going delinquent or defaulting in one of your relationship is higher. If it is close to 900, the chances are less. The score is built on your history and captures key trends like your repayment and credit usage among others.
Let’s say, you have a credit card and you are supposed to repay the credit in 30 days. If you are paying on time, then your credit history is good. It is only when you delay your payment or goes delinquent in one of your relationship, the history gets bad and the score goes lower. The score also predicts the likelihood of an individual going delinquent over the next 12 months.

Which variable would have a major impact on the score?

The biggest weightage is the number of relationships that an individual have with various banks. Secondly, it looks at the number of secured loans (home loans, auto loans) and unsecured loans (credit cards or personal loans). If you have 10 credit cards, then your rating is lower. The ideal situation is when you are paying your dues on time and having a combination of secured and unsecured loan.

How can an individual improve his score?

Score is a dynamic number. It is not static and doesn’t stay at one place. You can improve your score through financial discipline by not seeking credit all the time. If you start paying all the bills and dues on time, your score will increase.

How much does bank rely on the score?

Banks have become conscious of their asset quality. Our analysis during the previous quarters indicated a shift in banks approach while lending. Earlier in 2009-10, 40 per cent of the home loan buyers had a score of over 800 points. In the current financial year, 57 per cent of home loan buyers have a score of over 800. Similar is the trend in auto loans. This indicates that banks are increasingly looking at credit scores.
How much is the public aware of this process?
Over the last six months, we have seen an upsurge in individuals asking for their credit reports before even approaching a bank for loans.

How easy is it for an individual to approach CIBIL and get his credit report?

Earlier an individual was required to send a hard copy of his identity proof along with attested copy, which we have done away with. We have now started a service called direct to consumer where you can directly take reports from us. We have an online authentication tool where you can access your score online by just three easy steps. First you will have to visit the CIBIL website and fill the online request form, make payment of `450 through the net banking and answer three questions, which will be based on your credit history. Once these questions are answered and the fees processed, the credit score along with credit report will be emailed it to you.

If there is an error on the CIBIL report, what can be done?

You can visit our website, where there is an online facility through which you can write to our customer relationship. We will take it up with the credit grantor and alter it accordingly when the next report is generated. However, the authority to change anything is with the credit grantor as they own the data and CIBIL is only the custodian. Normally these are done in 30 days.

Banks to offer higher returns on NRI deposits to lure dollars

MUMBAI: A runaway currency has pushed the Reserve Bank of India to make interest rates more tempting for NRIs to bring in dollars. As the rupee closed at a new low on Wednesday, RBI allowed banks to offer higher return on dollar as well rupee deposits parked by NRIs.

Banks can now give 125 basis points over London Inter-bank Offered Rate, or Libor - the benchmark rate in international money markets on foreign currency non-resident accounts against a mark-up of 100 basis points permitted till now.

On non-resident (external) or rupee deposits, the interest rate cap has been raised to 275 basis points over Libor, from 175 bps. "It will help to improve sentiment," said Parthasarathi Mukherjee, president (treasury and international Banking) at Axis Bank. The six-month Libor is at 0.71%.

Earlier in the day, the rupee fell to a low of Rs 52.37 to the dollar, but recovered to an intraday high of Rs 51.75 on suspected dollar sales by the Reserve Bank of India. But despite intervention and the central bank's move to lift the $100-m cap on banks for swap, the local currency ended at 52.37.

Such swap transactions, where corporates enter into deals with banks to swap rupee loans to dollar, banks sell dollar in spot market and buy in forward. But the market did not feel that this will help to increase dollar supply. Global stock markets plunged to a six-week low on Wednesday after China's manufacturing activity in November dropped to a 32-week low, contributing to existing worries about US economic growth and Europe's debt worries.

Tracking the weakness across markets, India's key indices hit a two-year low as foreign investors dumped shares, unnerved by the uncertainty in the rupee's slide which closed at a record low of 52.37 against the dollar. The Sensex dropped 365.45 points, or 2.27%, to end at 15,699.97, but off the day's low of 15,478.69.

The Nifty fell 105.90 points or 2.20% to close at 4706.45. Brokers said several foreign ETFs, which are facing redemptions at home, were selling aggressively.

Stop-loss triggers at many hedge funds and foreign banks set off after the Nifty fell below 4700 mid-way through the session, precipitating the decline. But for the short-covering later, indices would have ended much lower. Foreign investors sold shares worth Rs 1186.42 on Wednesday, according to provisional data.

"Investors in India are more worried about the domestic events than the issues in the US and Europe. There is a total chaos in the currency market, with no uncertainty about where the rupee is headed," said Sandip Sabharwal, CEO-portfolio management services of broking firm Prabhudas Lilladher.

Finance minister Pranab Mukherjee on Wednesday attributed the stock market crash to withdrawal of funds by foreign investors and depreciation of the rupee.

"The rupee's underlying fundamentals still appear weak to us, especially the absence of yield support at this important moment for the currency. Indeed, there is the outside chance of an onshore USD squeeze being the catalyst which propels USD/INR to the 54.8 technical objective," said Stewart Newnham and Yee Wai Chong, analysts at Morgan Stanley.

The decline on Wednesday pushed the Nifty below the 200-week moving average of 4776, analysts said. "This is a sign of further weakness in the market as this is a long-term trend indicator," said AK Prabhakar, senior VP, Anand Rathi Securities. The MSCI Asia Apex fell 2.5% after the indications of weakening in China, the world's secondlargest economy, came a day after the US cut its Q3 growth figure.

China's preliminary HSBC manufacturing Purchasing Managers Index fell sharply to 48.0 in November compared with a final reading of 51.0 in October. The euro fell 1% after Belgian newspaper De Standaard said that the planned rescue of Franco-Belgian bank Dexia is unworkable.

The report triggered worries that France's AAA credit rating may be under threat. Report said the European crisis is making it tough for European banks to access dollar funding in money markets. Euro/dollar cross currency swaps, which measure the cost of swapping euros into dollars, are at the most expensive levels since 2008, according to reports.

SBI abolishes penalty on pre-payment of housing loans

24 Nov, 2011, 03.26PM IST, PTI   - ET
 
NEW DELHI: Country's largest lender State Bank of India (SBI) has decided to abolish pre-payment charges on home loans, giving some succour to borrowers who want to foreclose their accounts.

"We have decided to do away with the pre-payment charges on all kinds of housing loans with immediate effect," a senior official of the bank told PTI. The bank has been charging pre-payment penalties only on housing loans with floating interest rates taken before May 2011, the official said. It has been charging about 2 per cent of the outstanding amount as penalty if borrowers opted to foreclose their loans.

The decision from the largest lender will prompt other lenders to follow the suit.

The total outstanding home loan of SBI rose to Rs 92,383 crore at the end of September against Rs 86,769 crore in March 2011.

At present, some banks are charging up to 2 per cent as pre-payment penalty on the loan outstanding, if a borrower settles the full payment before maturity by switching over to another lender.
No pre-payment fine is charged if borrowers pay using their own funds.

It may be be noted that the Reserve Bank has indicated that it would scrap prepayment penalties charged by banks.

"It is proposed to implement the recommendations of the Damodaran Committee, on which a broad consensus has emerged, as also the action points which were identified by the IBA (Indian Banks' Association) and BCSBI (Banking Codes and Standards Board of India) in the last Banking Ombudsmen conference," RBI had said in its mid-year credit policy review.

Query Corner: Banking & Finance

24 Nov, 2011, 06.14AM IST,   - Economic Times

Auto Debit

Can a bank auto debit money from your savings account towards dues of credit card without sending notice to customer?-SATNAM HUNDAL

Bankers have a right of lien and set-off. Set-off means the bank can adjust the credit balance in a customer's account against a debit balance in another account of the customer. The deposit and loan should be due and lawful (law of limitation does not apply). There is no need to send any notice. In fact, the banker must have sent notice when the account was in default.

Net users cross 100m, to boost e-commerce

By S Shyamala Nov 07 2011 , Chennai

India has reached a milestone in tele­communications. The country has topped the 100-million in the number of internet users. According to an I-Cube report jointly released by the Internet and Mobile Association of India (IAMAI) and IMRB on Monday, the landmark was reached in September. If that be so, India now has the third biggest population of internet users.

Yet, in internet use India is way behind its own multitude of mobile subscribers. At 100 million, the internet population is just 11 per cent of its telecom subscribers numbering nearly 900 million. Among telecom companies, Airtel, Vodafone, Reliance Communications and Idea each already have 100 million or more phone sub­scri­bers.

Though a mi­lestone, India’s internet population is just a fifth of China’s 500 million. China has been rapidly adding to this population — in December it had 457 million. Yet, India’s is no mean achievement; only a handful of countries can boast of such numbers. The size has got e-commerce players excited.

Google India’s MD and vice-president of sales and operations, Rajan Anandan, told Financial Chronicle: “Hundred million internet users represent a tremendous market opportunity for companies like us. This will also create a great internet eco-system in India.”

Assocham recently estimated that the size of Indian e-commerce market is expected to touch Rs 47,000 crore by 2011.

Sachin Bansal, Flipkart CEO and co-founder, said the 100-million strong internet population validated his belief in India’s e-commerce potential. It would become one of the largest e-commerce-led economies in the world. “We will continue to aggressively invest in this space and contribute in every way we can,” said Bansal, who quit a cushy job at Amazon.com India to start India’s largest online shopping arcade.

The I-Cube report projects the number to rise to 121 million by December. Of them 97 million will be active internet users who access the web at least once a month. And nearly 92 million of them would be in urban India. Not bad, considering that the technologically far more advanced Japan has an internet population of 99 million.

K Vaitheeswaran, foun­der and CEO of Indiaplaza, said that though e-commerce in India had been in existence for some time, it was now that the full potential was being understood. “Over the past year or two real growth started to happen here. In the next few years the internet user base will zoom to between 350 million and 400 million. That makes it quite a large and attractive market for everybody, as there is a piece for everybody to nibble at,” he said.

As per latest Trai data, 12.6 million of India’s net users (as of August 31) connect to the web through broadband (at speeds greater than 256 kbps). Subho Ray, president of IAMAI, said in a statement.

“As before, common access points such as cyber cafes continue to play an important role but their role has suffered a big shrinkage. At 37 per cent access from home “is still not dominant”, said Ray. According to the World Bank’s development indicator, only 5.3 per cent of Indians had internet access in 2009, up from 0.5 per cent in 2000.

(With inputs from S Ronendra Singh and Kumar Shankar Roy in New Delhi)

Government should treat small units on a par with corporates

The Hindu

If the government wanted only efficient industrial units to survive, micro, small and medium enterprises (MSMEs) and large industries should be treated equally, Tamil Nadu Small and Tiny Industries Association (TANSTIA) vice-president KR. Gnanasambandan said here on Thursday.

When falling behind loan repayment schedules, small units incurred the wrath of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interests (SARFAESI) Act and its stringent provisions. However, when large corporates get into debt problems, they were being given the option of converting debt into equity. Such a situation existed despite small industries being hailed as the engines of economic growth.

Mr. Gnanasambandan was addressing a ‘Stakeholder meet on MSMEs under India MSME Darshan 2011' organised by Madurai District Tiny and Small Scale Industries Association (MADITSSIA) and Institute of Small Enterprises and Development (ISED), Kochi, in association with Federal Bank and Export Credit Guarantee Corporation of India (ECGC). ‘India MSME Report 2011,' prepared by the ISED, was released at the meeting.

Tamil Nadu was home to the highest number of registered MSMEs, largest employment per unit and highest investment per unit. However, it was also the State with the highest number of sick units and its output 

lagged well behind the national average, he said.

Speaking earlier, S. Maruthappan, General Manager of District Industries Centre, said that the State government was planning to train educated youth in entrepreneurship to prevent their migration from villages to cities.

S. Mohan, Assistant General Manager, State Bank of India (SBI), Zonal Office, said that the bank was designating several branches as ‘MSME branches' to facilitate smooth credit flow.

P.M. Mathew, ISED Director, said that in the U.S., a government department prepared such reports on small industries while in the U.K., the Bank of England prepared it, and by the private sector in the European Union.

MADITSSIA president V. S. Manimaran said that MSMEs faced numerous hurdles, power crisis and high interest rates being the primary factors causing concern. R. Jayaraman, former Madurai Kamaraj University professor, said that MSMEs were facing a shortage of skilled workers. K.S. Serma Pandiyan, MADITSSIA secretary, spoke.

RBI to discuss Damodaran committee recommendations with IBA

November 17, 2011 04:47 PM

The apex bank will discuss the suggestions on pre-penalty on foreclosure of home loan, Internet and mobile banking with the IBA; Out of the 230 recommendation of the Damodaran Committee around 88 have already been accepted by the RBI

The Reserve Bank of India (RBI) has accepted 88 out of the 230 recommendations made by the Damodaran committee on customer services. While some of them are already in the public domain, the apex bank would be discussing the remaining suggestions with the Indian Banks’ Association (IBA) later this month.

Sources say that the 88 recommendations, where bankers had consensus, include recommendations such as banks should sell standalone financial products and not bundle it with any other product, have been accepted by the RBI. Some pending recommendations such as not imposing pre-penalty on foreclosure of home loan and suggestions made on mobile and internet banking, RBI will have a discussion with IBA by the end of this month.

SBI to auction assets of 21 defaulters in Patna

Kumod Verma, TNN Nov 17, 2011, 05.19PM IST

PATNA: In a major policy decision, the Stressed Assets and Resolution branch (SARB) of the State Bank of India, Patna, has decided to auction the mortgaged properties of 21 borrowers valued at Rs 4.21 crore at the branch premises on November 21.

These borrowers, who had taken loan from SBI, not only failed to repay the money but also did not turn up for negotiations with the bank, said additional general manager (AGM), SARB branch, Sunil Sharan Sinha.


He said there were altogether 21 borrowers who were declared defaulters long time ago under the bank rules. Their properties, which include plots, houses, shops and other assets, would be put on an open auction on November 21.

Sinha maintained that the bank has still kept its door open for defaulters till November 19 afternoon to reach a settlement with the bank in their own interest; otherwise, the bank would go ahead with the open auction plan under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002.

Two of the borrowers, New Cozy Sweets and Golu Kiranaz, both located in Danapur, reached a settlement with the bank on November 16, he added.

According to sources, the SBI has kept the reserved price of the total properties to be auctioned at Rs 4.21 crore. They would thus be put on auction at not less than Rs 4.21 crore. A piece of land located in the prime area of Gardanibagh and a sprawling house in S K Puri have also been targeted for open auction, sources said.

The SBI AGM said this would be the first time that Patna SARB will auction mortgaged property in the state capital to realize the bank's dues from defaulters. He said that bank officials right from chief manager to general manager would be present at the open auction.

"The SBI usually restrains itself from taking such harsh steps. But faced with the apathetic attitude of borrowers towards repayment of their loans, the bank has been forced to take such a step," he said.

Weavers in a fix over loan waiver

 November 15, 2011 - By DC Correspondent - Anantapur 

A stalemate continues over the recovery of Rs 17 crore loans from handloom weavers in the district as the government proposed to waive these.

A stalemate continues over the recovery of Rs 17 crore loans from handloom weavers in the district as the government proposed to waive these.

State government proposed to waive Rs 16.9 crore loans availed by 9,104 crore handloom weavers in the district and the file has been sent to the ministry of finance.

While the weavers are refusing to pay the loans, bankers are insisting that they do so. Weavers who are already reeling under a financial crunch, are not in a position to repay the instalments.

A widow, Poojari Govindamma of Hindupur whose husband Krishnam-urthy committed suicide unable to pay debts one-and-a-half year ago, lamented that her husband borrowed Rs 1.3 lakh loan from a bank and repaid Rs 83,000 before he died, but she received notices from the bank about confiscation of property as per the Sarfaesi Act (The Securitisation and Reconstruction of Financi-al Assets and Enforcement of Security Interest Act, 2002). The Sarfaesi Act allows banks and financial institutions to auction properties (residential and commercial) when borrowers fail to repay their loans. It enab-les banks to reduce their non-performing assets (NPAs) by adopting measures for recovery or reconstruction.

Thousands of weavers have received notices from banks, demanding repayment of loans, though government agreed to waive these.

Bankers said that recovery percentage was poor and notices would be served to the defaulters until the government issued loan waiver orders.

Meanwhile, the order to waive 3,400 handloom weavers’ loans to the tune of Rs 8.9 crore is not being implemented on expected lines as bankers are delaying no due certificates to the beneficiaries.

As a result, cash is not credited into the bank accounts of beneficiaries. In fact, state government promised to waive weavers’ loans of Rs 348 crore of which Rs 109 crore were released across the state. It assured Rs 239 crore loan waiver in the next phase. Weavers are in a dilemma with bankers refusing to credit the cash in their bank accounts.

Dena Bank net up 20.5 pc

PTI | 09:10 PM,Oct 31,2011

Mumbai, Oct 31 (PTI) Mid-size public sector lender Dena Bank today posted a 20.5 percent rise in net profit to Rs 193.58 crore for the second quarter on the back of rising net interest income and improvement in its asset quality. "We have posted good numbers despite a difficult interest rate regime," Chairman and Managing Director DL Rawal told reporters here. Total income increased 30.35 percent to Rs 1,747.19 crore compared to Rs 1,340.38 crore a year earlier, while net interest income rose 10.66 percent to Rs 514.89 crore against Rs 465.27 crore. However, reflecting the hardening interest rate scenario, the net interest margin fell to 3.22 percent from 3.52 percent reported in the same period last year. But this was 0.32 percent up over the last quarter. During the second quarter, total deposits grew 20.07 percent to Rs 64,235.67 crore while advances rose 17.95 percent to Rs 43,100 crore. "We hope our credit growth for this fiscal will be around 20 percent as we expect credit to pick up in agri-related sectors in the second half of this fiscal," Rawal said. Asset quality of the bank also improved during the reporting quarter. While gross NPA declined to 1.93 percent from 2.26 percent a year earlier, net NPA improved to 1.15 percent from 1.49 percent reported in the same period last year. "We will be able to maintain the NPA level at the present level as we are closely monitoring all our loan assets," Rawal said, adding the bank is focusing on recovery of its existing NPA portfolio. The bank's capital adequacy ratio stood at 12.55 percent by the end of the September quarter. The Dena Bank shares soared 6.04 percent to close at Rs 80.70 on the BSE, whose main index inched down 0.6 percent on profit booking. 

Dena Bank net up 20.5 pc

BS Reporters / Mumbai/bangalorenew Delhi/kolkata November 1, 2011, 0:24 IST

Asharp rise in provisioning for bad loans lowered the net profits of public sector banks in the second quarter of this financial year. Most banks saw an increase in non-performing assets (NPAs) on back of rising interest rates and migration to an automated recognition system.

Mumbai-based Bank of Baroda (BoB) posted an increase of 14.4 per cent in net profit at Rs 1,166 crore in the quarter ended September, provisioning for bad loans more than doubled to Rs 298 crore as compared to same quarter, last year. “Increase in NPAs was seen from all sectors and geographies,” said M D Mallya, chairman and managing director. He said Rs 663 crore worth of assets were restructured quarter and 10-11 per cent of the total restructured portfolio slipped into NPAs in July-September.

Sundaram Finance sees disbursement growth slowing to 15% this fiscal

Published: Friday, Nov 4, 2011, 8:00 IST
By Vishwanath Nair | Place: Mumbai | Agency: DNA

Regulators should ensure that players in the banking, financial services and insurance industry get a level-playing field, argues T T Srinivasaraghavan, managing director, Sundaram Finance. In an interview with DNA, he spoke about how a well-deserved hike to employees is not a burden to his company and how prevention is the best cure when it comes to asset quality. Excerpts from the interview:

What kind of disbursement growth you are targeting this fiscal? Which are the sectors pushing growth?

In our annual report published in May this year, we had said that the automotive industry’s two successive years of high growth is exhibiting clear signs of slowdown. With fleet replacements (replacing older model vehicles with new and improved vehicles) largely being completed to comply with emission norms and changes and demand for consumer goods beginning to moderate, sales of medium and heavy commercial vehicles are expected to increase by 5-8%. Looking at the numbers now we seem to be pretty much on target. We are expecting overall gross disbursements growth to be in the 15% range for the current fiscal as against 22% in the last. Growth is coming from light commercial vehicles, construction equipment, a little bit of tractors, so there is growth happening in parts of the auto industry. While medium and heavy is not growing at 30% like previous years, there is some growth which is contributing.

NIMs will stay between 3.2-3.5% in long-term: Andhra Bank

Published on Wed, Nov 02, 2011 at 16:27 |  Source : CNBC-TV18

 Completing its 100% migration to system-based NPA recognition, in an interview to CNBC-TV18, R Ramachandran, chairman and managing director of Andhra Bank says its is one of the reasons why the bank's NPAs have gone up in Q2.



Post the Q2 results declared today, he says the bank's MFI exposure is at Rs 250 crore and he has not seen any delinquencies in MFI loans. Further, he says, "in the long-term NIMs (net interest margins) will be stabilising at 3.25% and 3.5%."
 
Q: Asset quality seems to be a bit of problem right now and gross NPAs have definitely increased, is there any particular sector that is giving you trouble at the moment, the agricultural sector even on the power side?

A: We have declared results after doing 100% system generated NPA, we have gone through that and our software has picked up more than one lakh thirty thousand accounts below one lakh category.
As a result of which particularly our agricultural sector, the NPAs have gone up by more than Rs 500 crore in this particular quarter. Hence, it is one of the reasons why our NPAs have gone up.
Going forward, more than 50% of this can be recovered before the end of this financial year because these are not accounts that are likely to slip further. It is just that the system has captured it and traditionally Andhra Bank has been position to affect good recoveries out of its agricultural advances. We are pretty confident that substantial portion of it will be recovered, unless and until there are external reasons.

Q: Would it be safe to say that the transition to system based recognition is now done and you don't have a significant rise in the NPAs in the coming quarter?

A: Yes certainly, we have done it 100%, to its full effect and going forward, from next quarter onwards, you will not see any increase in advances on account of any deficiency in capturing through the system. We expect this to pan out to a level by which we will only see increase in recovery and improvement as far as reduction in NPAs is concerned.

Q: Could you tell us the exposure that Andhra Bank has to the MFI and power sector and has there been any fresh slippage in this account on both these two?

A: Our advances to MFIs is very nominal, it is just around Rs 250 crore in terms of out standings and it has come down from Rs 290 crore to Rs 250 crore and the exposure is not high and we have not seen any delinquency in that. A few accounts went in for restructuring, we anticipate things to fall in line and we don't anticipate any stress on account of that.

As far as power is concerned there has to been any case for restructuring of any of the advances. Our power outstanding were around Rs 9187 crore to power sector, which is 12.33% of the total advances.

Q: Some of your statements say that you see a pressure of about 30-35 basis points in terms of NIMs pressure in Q3, where do you se this pressure coming from is it to do with savings rate and its deregulation cost will not be able to be passed on or is there any other pressure?

A: Partly, it is to do with savings rate, partly also to do with the fact that reprising of all the earlier deposits that are taking place now. So, traditionally wherever we have taken deposits for a long-term for 2-3 years, which is at a lower rate of 6.5-7-7.5 % than today, we offer for one year at an interest rate of 9.4%.

We have been in a position to more or less maintain the NIM between 3.8 and 3.9 for three to four quarters. If you look at our NIM for September 2010 it was around 3.91, so we have been able to maintain it at this level. However, going forward, it will be difficult because one is the reprising.

Secondly, the fact that eventually we have to be competitive; when there is a deregulation in savings bank and going by the present market trends there may be certainly an upward pressure for us to revise the savings account rates shortly and when we revise it, it will certainly go up. I will not be able to quantify it, till a decision is taken but it will certainly have an impact and pressure on our NIMs.

Q: Do you see the long-term NIMs stabilising at 3.5%?
A: It will be between 3.2 - 3.5%. We don't expect it to go to 3.2%, it should be between 3.25% and 3.5%.

Q: The exposure of over Rs 9000 crore to the power sector is quite high and we have already seen one of the banks Punjab National Bank going in for restructuring of those loans, even if you have not done it in this quarter is there a likelihood that in the coming quarter you see reason to restructure the exposure to power sector?

A: Firstly, we have not received any request for restructuring from any of our borrowers in the power sector. Secondly, most of the projects for which we have given advances, are all in the implementation stage, so it is too early to say whether they will require restructuring at all.

There can be some stress but it has not come to a level where borrowers have come and asked for a restructuring, therefore, it is too premature for me to say whether there will be a restructuring at all. I do not anticipate any restructuring to happen for at least one quarter.

Indian Overseas Bank expects capital infusion of up to Rs 1,450 cr from government

PTI Nov 1, 2011, 06.17pm IST

MUMBAI: State-run Indian Overseas Bank is expecting a capital infusion of up to Rs 1,450 crore from the government by February 2012, a top official said here today.

"We have made a request to the government and will be requiring up to Rs 1,450 crore...it will come this fiscal itself," bank's Chairman and Managing Director M Narendra told reporters here.

He, however, declined to comment when asked about the route Indian Overseas Bank (IOB) will adopt for the proposed capital infusion.