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STATE BANK NET UP 3.3% AS BAD LOAN PRESSURE EASES

Mumbai: After witnessing decline in profit for six consecutive quarters, State Bank of India (SBI), the country’s largest lender, reported 3.3 per cent net profit growth to Rs 3,349 crore for the quarter ended June, compared to Rs 3,241 crore in the corresponding period of last year. Arundhati Bhattacharya, Chairman, SBI, said: “Pressure (on asset quality) appears to be subsiding. But we need to see a pick-up in the economy to see appreciable changes in asset quality.” Net interest income grew 15 per cent to Rs 13,252 crore and fee income growth was 11 per cent to Rs 2,837 crore, though there was a fall in treasury income. The profitability got a boost of Rs 6,000 crore from sale of stressed assets to asset reconstruction companies (ARCs) during the q

BPCL PLANS OVER RS 16K-CRORE ASSAM REFINERY EXPANSION

NEW DELHI: State-run oil refiner-marketer Bharat Petroleum Corporation Ltd has drawn up plans to ramp up the capacity of its refinery at Numaligarh in Assam’s Golaghat district from three million tonnes per annum to nine million tonnes at an investment of Rs 16,600 crore.

The project includes laying a 1,350-km pipeline to bring in crude from a port on the east coast. While the refinery expansion would cost about Rs 8,800 crore, the remaining investment is expected to go into laying the pipeline and other assorted facilities.

Company sources said the project would mark the single-largest investment in Assam and boost economic activities in the north-east as well as unlock potential for exporting fuels to India&

INDIA, US DECIDE TO JOINTLY PRODUCE DEFENCE EQUIPMENT

New Delhi: With co-development and co-production of defence products in mind, India and the US on Friday agreed to take the Defence Technology and Trade Initiative forward.

The decision was taken at the delegation-level talks between defence minister Arun Jaitley and US secretary of defence Chuck Hagel, who is on a three-day visit to the country.

In the meeting, both sides took note of the progress made over the years in deepening defence ties. Both the sides reaffirmed their desire to further enhance bilateral defence cooperation, especially in technology and discussed ways for strengthening this partnership.

Stressing on indigenisation of the defence industries, Jaitley said, “The develop

Etihad seals $2.4b deal for Alitalia stake

Etihad Airways PJSC signed a 1.76 billion-euro ($2.4 billion) deal to purchase 49 percent of Alitalia SpA, giving the Gulf company access to one of Europe’s biggest travel markets and providing a lifeline to Italy’s unprofitable former flag-carrier. Etihad will invest 560 million euros in Alitalia, while existing core investors have approved a 300 million-euro capital increase and Italian financial institutions will supply the same amount in […]

EU eyes Mideast sugar market as quotas end

The European Union, a net sugar importer, could emerge as a major exporter of white sugar to the Middle East and Africa after production quotas are lifted in 2017, eroding the market share of northern hemisphere refineries. The EU is expected to end sugar production quotas – currently at some 14 million tonnes per year – as part of reforms to create a freer sugar market. Analysts […]

Asian governments join sukuk rush

Hong Kong, Indonesia and Pakistan are banking on pent-up investor demand as they look to raise up to a combined US$3.5bn in the fast-growing Islamic bond market. The three sovereign sukuk issues, including a planned US$1bn debut from Triple A rated Hong Kong, are set to launch before the end of September. Few Asian issuers have targeted the global sukuk market in the past, and the glut […]

RBI REWORKS RULES FOR LONG-TERM INFRASTRUCTURE REFINANCING LOANS

MUMBAI: The Reserve Bank has relaxed norms for refinancing of infrastructure loans which banks want to be tagged as standard assets. From April 2015, the moment a loan is restructured, banks will have to classify them as bad loan. RBI had made an exception to the rule by allowing banks to classify infrastructure loans as standard assets if half of the outstanding loans are refinanced by a new set of lenders in the form of take-out financing. On Thursday, the central bank relaxed this norm by allowing standard tag if 25 per cent of the outstanding is met through take-out financing. Also, an infrastructure loan that is refinanced can be tagged as standard asset provided promoters are willing to invest more equity in the project. But the standard tag will be a

Amlak creditors approve $2.7b debt restructure

 Dubai mortgage lender Amlak Finance said on Thursday that all its creditors had approved a plan to restructure its debt, bringing to a close protracted talks over the last major hangover from the emirate’s property market crash of 2008. Twenty-eight creditors had been seeking a deal with the Islamic lender, which had its shares suspended from trade on the Dubai Financial Market in November 2008 as the […]

Meraas Holding plans IPO

Dubai government-owned property developer Meraas Holding is considering selling shares to the public as the regional real-estate market continues its rapid recovery from the financial crisis, according to three people familiar with the matter. The real-estate company, which has close links to Dubai’s ruler Sheikh Mohammed bin Rashid Al Maktoum, recently sent a request for proposals to banks who have until September to reply, said one of […]

NDA EASES GREEN RULES TO PUSH INVESTMENTS

NEW DELHI: Through a quick series of notifications, the Union environment ministry has eased rules for mining, roads, power and irrigation projects and other industrial sectors. It has diluted a host of regulations related to environment, forest and tribal rights. Besides, sources in the ministry say, more changes in regulations are in the pipeline.

Environment Minister Prakash Javadekar had earlier done away with the requirement of public hearing for coal mines below 16 million tonnes per annum (mtpa) wishing to expand output by up to 50 per cent. This has now been extended to mines above 16 mtpa, permitting them to mine up to five mtpa more without consulting affected people. Public hearings, the only occasion when affected people are

BILL TO REFORM POWER SECTOR IN WINTER SESSION

NEW DELHI: The government will bring a Bill, amending the Central Electricity Act, in winter session of Parliament to improve the tariff policy and regulations in the power sector. The power ministry is working out different tariff structure for different times of the day for easy availability of power for maximum hours in electricity deficit areas. It will soon consult states over the issue as the tariff matter comes under the states’ domain.

Besides, the government has decided to promote domestic power companies to help increase solar power generation in the country. Announcing these decisions in Rajya Sabha, power minister Piyush Goyal said the government will allow only 100% indigenous domestic companies to participate in the

Americans continue to give up passport to escape tax net

Americans continue to renounce passports to escape tough tax scrutiny although the number of Americans renouncing U.S. citizenship declined 13 percent in the final half year before rules that make it harder to hide assets from tax authorities came into force. People giving up their nationality at U.S. embassies fell to 1,577 in the six months through June, from 1,809 in the year-earlier period, according to Federal […]

Qatar raises foreign ownership limit

Qatar’s emir has issued a law providing for foreign investors to own up to 49 percent of listed Qatari companies, part of reforms to expand the stock market and develop the financial industry. “The law stipulates that non-Qatari investors are allowed to own no more than 49 percent of the shares of Qatari shareholding companies listed on Qatar Exchange,” the official Qatar News Agency (QNA) said on […]

Rising rates may revive appetite for Islamic commodity trades

A return to an era of higher interest rates could derail attempts by Islamic finance to create alternatives to a short-term funding instrument that has dominated the industry, but which some scholars and regulators want to see replaced.  Islamic finance has been trying to diversify away from so-called commodity murabaha, a common cost-plus profit arrangement, in an attempt to reduce reliance on a single tool, stop money […]

TO CAPITALISE PSBs, GOVT WILLING TO PRUNE ITS STAKE TO 52 PER CENT

The finance ministry is likely to put out a note soon, detailing its road map to capitalise state-run lenders while explicitly stating the government’s intent to maintain control over public sector banks with at least 52% stake.

This marks a shift from the previous UPA government’s decision to keep 58% shareholding in state-run banks. It is in keeping with the Narendra Modi-led government’s stand articulated in the Budget 2014-15 that it would encourage banks to raise capital from the market.

The government will push banks this way to the point of its own stake falling to 52%, to reduce reliance on the budget.

It has set aside only Rs 11,200 crore for bank capitalisation this f

JOINT SESSION NOT POSSIBLE NOW ON INSURANCE BILL

NEW DELHI: The central government’s worries on the Insurance Bill aggravated on Tuesday with Congress accusing it of adopting double standards on the issue and dismissing threats from the treasury benches that a joint session may be convened, forcing BJP ministers to knock on the doors of parties like SP and BSP to muster the numbers in the Rajya Sabha. Congress sources maintained the government was reportedly keen on passing the insurance bill in Parliament in this session so that Prime Minister Narendra Modi can showcase it to the US during his visit in September and hence wants to hurry through the process without sending it to a select committee of the Rajya Sabha. BJP leaders, on the other hand, alleged Congress was playing politics on

POWER MINISTRY MULLS FUND TO FINANCE HYDRO PROJECTS

NEW DELHI: The power ministry plans to create a fund to provide long-term finances to hydropower developers, and aims to play an active role in resolving state level sues that are blocking such projects.

“Hydropower did not get the desired attention as concerned ministries and departments were working in silos, and problems with states and central authorities could be resolved.

However, the new government is working in tandem as a team and we are hopeful to resolve pending issues to give conducive environment to hydropower sector,” power, coal and renewable energy minister Piyush Goyal said on Tuesday.

He said one of his first projects Prime Minister Narendra Modi inaugurated was the

RAJASTHAN GOVERNMENT BANKS ON HPCL DATA TO NULLIFY LATTER’S CLAIM

JAIPUR: The Rajasthan government while censuring previous Congress government for ignoring state’s interests while signing memorandum of understanding (MoU) with Hindustan Petroleum Corporation Limited (HPCL), has banked on the HPCL’s own consulting firm, SBI Caps’ report.

Chief minister, Vasundhara Raje, during her budget speech, said that based on appraisal report, the project will earn revenue of more than 68,000 crore within 15 years, from the day of production.

According to government officials, the data was cited from the report prepared by HPCL-appointed consulting firm, SBI Caps. Riding on these figures, the government is firming its stand on renegotiating the terms. “These facts came

End of dollar’s ‘extraordinay esteem’

|By K Raveendran| Is the ‘irrational exuberance’ man at it again? Allen Greenspan, whose description of the state of the market during the course of a nondescript banking speech in 1996 presaged a bubble burst three years later, has spoken out again. The former Federal Reserve Chairman has in a TV interview suggested that the ‘extraordinary esteem’ in which dollar is held around the world may not […]

Egypt plans Suez parallel channel

Egypt plans to build a new channel parallel to the Suez Canal in a 60 billion Egyptian-pound ($8.4 billion) venture to boost capacity at the vital global waterway, marking a new era of regeneration after the 2011 revolution. Construction of the new passage is scheduled to take three years, though President Abdel-Fattah El-Sisi has ordered it to be completed in a year, Mohab Mamish, head of the […]

MINISTRY WORKING ON SWEETENING BANKRUPTCY PILL FOR SICK UNITS

NEW DELHI: The government is working on developing a bankruptcy framework to offer easier exit routes to sick companies while helping revive those with viable options, said Kalraj Mishra, the new minister for micro small & medium enterprises (MSMEs).

Another issue the ministry is dealing with is availability of land for industrial units. It is asking states to create land pools by listing out all unused land available with them.

“Entrepreneur bankruptcy framework will be developed to enable easy exit of sick units,” Mishra told ET. “It has been a major demand of the MSME sector for a very long time. The details will be worked out soon.”

SMEs employ close to 40 per cen

GOVT OPEN TO MINOR CHANGES IN INSURANCE BILL

New Delhi: Finance Minister Arun Jaitley on Monday said the government was open to accommodating minor modifications to the Insurance Laws (Amendment) Bill, 2008, so that it could be passed in the current session of Parliament. He also said calling a joint session of Parliament was a real option if the Bill was defeated in one of the Houses. After an all-party meeting failed to break the deadlock on the issue between the government and Opposition, Jaitley on Monday reached out to the Congress. But the Congress continued to insist the Bill be sent to a select committee of Parliament, as it now was much changed from the one the United Progressive Alliance (UPA) government had tabled in the Rajya Sabha. The party added it would be willing to support the legisl

INDIA EYES $40-BILLION PIPELINE FROM RUSSIA TO IMPORT GAS

NEW DELHI: In a move aimed at ensuring India’s energy security, the Narendra Modi-led government plans to import huge volumes of natural gas from Russia. The Centre is working out the contours of a $40-billion (Rs 2.4 lakh-crore) mega onland pipeline project carrying gas from Russia to India, in one of India’s biggest energy projects till date.

Top government officials told HT that the move follows Prime Minister Narendra Modi’s recent meeting with Russian President Vladimir Putin in Brazil on the sidelines of the Brics summit.

The Prime Minister’s Office (PMO) along with the ministry of petroleum and natural gas are preparing a blueprint to examine the feasibility of this new project, they added.

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Dubai Investments bullish on upgrade

Dubai Investments (DIC), whose profit jumped 240 percent in the second quarter after it sold assets, says it may be on the cusp of its first ever investment-grade rating as it bolsters cash holdings. The company expects the credit rating to be increased by year-end to at least BBB, two steps above junk, according to Chief Executive Officer Khalid bin Kalban. Its Dubai Investments Park Development Co. […]