UTI Bank to raise funds via GDR

MUMBAI: UTI Bank on Friday said it will tap the overseas market as part of its plans to raise over Rs 4,000 crore to meet increasing credit demand and new capital norms.

The company would issue 1.41 crore equity shares in the overseas market, besides offering 3.19 crore shares to its promoters on preferential basis.

In a notice to the Bombay Stock Exchange, UTI Bank said the board has decided to raise capital by way of Qualified Institutional Placement (QIP) of 2.82 crore shares and a GDR issue of 1.41 crore equity.

Going by today's market price of Rs 641.25, the bank could raise over Rs 2,711 crore from the market.

"The price for the preferential issue, GDR and QIP offering would be aligned and subsequently decided through the book building route," Bank President Finance Somnath Sengupta said.

Seven promoters including -- specified undertaking of the Unit Trust of India hold 27.33 per cent, while LIC and GIC together have 42.93 per cent stake in the bank.

"We have received the approval for the preferential issue from SUUTI and LIC. GIC and other promoters have time till July 26 to decide on subscribing to the issue," Sengupta said.

The shareholders in its EGM held today have approved raising of Tier-I capital by way of GDRs and issue to the promoters.

Shares of the bank surged to a 52-week high of Rs 658.70 during the day, but closed at Rs 641.25 up 0.02 per cent on the Bombay Stock Exchange.

For the quarter ended June 30, the bank posted a 45.15 per cent rise in net profit at Rs 174.98 crore as against Rs 120.55 crore in the Q1 of previous fiscal.

Source: Economic Times

Mexican Slim zips past Bill Gates in rich ranks: Report

Mexican tycoon Carlos Slim is the world’s richest man, worth an estimated $67.8 billion, after overtaking Microsoft Corp. founder Bill Gates

Mexico City: Mexican tycoon Carlos Slim is the world’s richest man, worth an estimated $67.8 billion, after overtaking Microsoft Corp. founder Bill Gates, according to a respected tracker of Mexican financial wealth on 2 July.

Mexican tycoon Carlos SlimA 27% surge in the share price of America Movil, Latin America’s largest cell phone operator controlled by Slim, from March to June made him close to $8.6 billion wealthier than Gates, said Eduardo Garcia in Sentido Comun, the online financial publication he founded.
Garcia estimated that Gates was worth $59.2 billion.
Forbes magazine reported in April that Slim had overtaken billionaire investor Warren Buffett for the No. 2 spot in the world’s richest stakes but was still behind Gates.
Mexico has a huge rich-poor divide, with a tiny elite holding most of the country’s wealth and around half the population living on less than $5 a day.
Forbes bumped up Slim because gains from his holding company Carso and fixed-line telecom Telmex added to the Mexican’s fortune while shares of Buffett’s Berkshire Hathaway Inc. fell in the same period.
Three months ago, Sentido Comun’s Garcia begged to differ with Forbes and calculated Slim’s wealth as more than Gates’ -- but only by a whisker. Now he says there is no doubt whose fortune is bigger at current share values.
“When I put Slim ahead three months ago Forbes bumped him up to second place (in world rankings) a few days later,” Garcia, also the publication’s editor-in-chief, told Reuters. “Let’s see if the same happens again.”
Spokespeople at Forbes magazine were not immediately available for comment.
Garcia, who uses Forbes’ calculations for US billionaires’ wealth, says the 5.7% increase in Microsoft share prices in the second quarter is no match for the sharp rise in valuations of Slim’s companies.
Shares of Telmex in the second quarter rose 11% and Slim’s bank, Inbursa, saw its stock advance 20%.
Garcia’s Sentido Comun, which translates as “common sense,” reckons Slim and his amily own a fortune equivalent to 8 percent of Mexico’s gross domestic product.
For Gates to be worth 8% of the US economy, his fortune would have to grow to more than $13 trillion, 17 times his current wealth, according to Sentido Comun.
Slim, known for his Midas touch in turning around struggling businesses and turning them into profit-making machines, told Reuters in an interview this year he was not in the habit of calculating his fortune on a regular basis.
Slim and his chief spokesman Arturo Elias Ayub were not immediately available for comment.

Source: Mint

6 PSU banks join Rs 1 lakh cr club

Higher credit offtake combined with robust deposit growth saw six public sector banks cross the landmark Rs 100,000 crore figure in business turnover, which includes net deposits as well as advances, in 2006-07.

The six banks that have joined the major league are Syndicate Bank, Indian Overseas Bank, UCO Bank, Oriental Bank of Commerce, IDBI Bank and Allahabad Bank.

State Bank of India (SBI) tops the chart of large-sized banks, with a total business turnover of Rs 772,858 crore, followed by Canara Bank (Rs 240,887 crore), Punjab National Bank (236,456 crore), Bank of Baroda (Rs 2,08,537 crore), Bank of India (Rs 204,817 crore), Union Bank of India (Rs 147,566 crore) and Central Bank of India (Rs 134,572 crore).

This took the total number of public sector banks that have surpassed the Rs 100,000 crore mark at the end of March 2007 to 13 against seven banks in 2005-06. With the Indian economy growing at a rapid pace, both deposits and advances have increased significantly during 2006-07.

The aggregate business turnover of public sector banks rose almost 26 per cent during the year compared with last year, while the total business volume rose by 7,05,713 crore to Rs 34,34,322 crore as on March 31, 2007.

The aggregate deposits of public sector banks rose 23 per cent to Rs 19,94,200 crore against Rs 16,22,481 crore, while bank credit recorded a robust growth of 30 per cent to Rs 14,40,123 crore compared with Rs 1106128 crore last year.

With rising inflation, interest rates rose across the board during the fiscal. Interest rates on deposits of major public sector banks over one-year maturity increased from 6-7 per cent in March 2006 to 7.5-9 per cent (as per the RBI Weekly Statistical Supplement) in March 2007.

While the increase in lending rates had a moderating impact on credit growth, the jump in deposit rates created favourable conditions for deposit growth.

Vijaya Bank, United Bank of India, Bank of Maharashtra and State Bank of Travancore crossed the Rs 50,000 crore mark to join the league of mid-sized banks.

Source: Business Standard /Swapnil Mayekar / Mumbai June 26, 2007

UTI Bank puts off $600m GDR

Move to give promoters more time to take a call on the issue.

UTI Bank, a mid-sized private sector bank, has deferred its $600 million global depository receipts (GDR) issue as well as the simultaneous preferential offer to its promoters.The bank said the decision to put off capital raising plans was taken in order to provide promoter shareholders - Specified Undertaking of Unit Trust of India (SUUTI), Life Insurance Corporation and General Insurance Corporation - more time to take a call on subscribing to the preferential offer.SUUTI is the largest shareholder in UTI Bank with 27.43 per cent stake. LIC owns 10.38 per cent of the bank’s equity and GIC 2.38 per cent.In a statement released after the bank’s extraordinary general meeting (EGM) here today, UTI Bank said the special resolutions on raising capital have been deferred “to provide promoter shareholders further time for consultation” on the preferential share offer.The shareholders would again meet on July 13 to consider the plans to raise capital. The shareholders, however, passed a resolution increasing the bank’s authorised capital to Rs 500 crore from Rs 300 crore.Banking sources said LIC, which bid in the recently concluded ICICI Bank’s follow-on equity offer for shares worth about Rs 4,000 crore, has asked for more time to arrange for funds as it was currently experiencing a “tight liquidity” situation.SUUTI, which has already obtained the government’s permission, also needs to arrange for funds to subscribe to its portion of the preferential offer.While SUUTI would need to pay about Rs 1,300 crore to subscribe to 20.3 million shares being offered on a preferential basis, LIC requires about Rs 450 crore for 7.6 million shares and GIC around Rs 50 crore for about 0.7 million shares.If the shareholders had passed the resolutions today, the promoter shareholders would have had to subscribe to the preferential offer within 15 days from the commencement of the EGM, in accordance with the Securities and Exchange Board of India (Sebi) guidelines. There is no provision for part payment in a preferential allotment.UTI Bank has already appointed Goldman Sachs and Citigroup as the merchant bankers for the GDR issue. The GDRs are proposed to be listed on the London Stock Exchange.P J Nayak, chairman and managing director of UTI Bank, had earlier said, “We thought making the preferential offer simultaneously with the GDR issue was the fairest way to raise adequate capital and also ensure good corporate governance practice, whereby the existing promoters are given an option to maintain their shareholdings.”

Source: Business Standard BS Reporter Mumbai June 26, 2007

Get online,not in line,to pay tax

2007-06-21 14:41:12
Email Print Version
Paying taxes has never been simpler with the authorities introducing the mechanism of online payment. The use of electronic means to deliver services is not only an efficient and speedy process, but it also facilitates a transparent process for disseminating information and delivering it to the taxpayers of the nation, says the Economic Times.

Online payment of taxes helps you save time, is convenient and is paperless. You could be in office or at home — the facility to pay taxes is just a click away. To use of this facility, all you need is an account with a bank that offers net banking and e-tax payment facility. SBI, HDFC Bank, IDBI Bank, UTI Bank and Union Bank of India are some banks that provide the e-tax payment facility.

The procedure for payment of taxes online is simple and the user-friendly instructions make it even more attractive. To start with, you need to log on to NSDL-TIN website (www.tin-nsdl.com) and click on the ‘e-Tax-online payment’ option. You will then be directed to a list of banks that provide the e-tax payment facility. Click on the option for your bank and choose the applicable tax challan.

If it is a tax deducted at source payment, challan no. 281 shall apply; else challan nos. 280, 282 or 283 shall be applicable. Challan no. 280 is used for payment of advance tax and self-assessment tax. Challan no. 282 is used for payment of miscellaneous taxes like gift tax, wealth tax, estate tax, expenditure tax etc. Challan no. 283 is used for payment of fringe benefits tax or banking cash transaction tax.

On opting for the challan type applicable, particulars such as the permanent account number (PAN) or tax deduction account number (TAN) as may be applicable, name and address of the taxpayer, relevant assessment year, type of payment and name of the bank will be displayed.

These particulars will need to be filled in carefully as an incorrect PAN/TAN (if it does match the records of the income-tax department) will not allow further processing of the payment. The mandatory fields are highlighted and to ensure smooth processing, these fields need to be populated. You will then reach the net-banking site provided by your bank where you hold your account and with the use of the allocated customer ID and password, the payment will be processed.

Once the process is complete and the bank processes the online transaction, you will be issued an acknowledgment indicating the challan identification number (CIN). After a week of making the payment, the status of the payment may be verified at the NSDL-TIN website under section ‘Challan Status Inquiry’.

You can also verify the payment of taxes through an online bank statement. Apart from being relieved of the hassles of visiting the bank for paying taxes and the additional paper work, an added advantage is that online payment does not require attaching the acknowledged counterfoil with your return.

Quoting the challan identification number is sufficient proof for the tax authorities. Imagine, not having to worry about the challan copies and the related paperwork. As for security concerns, the authorities assure the taxpayers that the transmission through the NSDL-TIN website is encrypted and is with the secure socket layer authentication.

SBI, LIC, others to dilute 50% in UTI MF via IPO

UTI AMC will be the country’s first domestic mutual fund to go for an IPO, through which sponsors will make a partial exit

Kolkata: UTI Asset Management Company will float an initial public offer by March-end next year to help its sponsors, SBI, LIC, PNB and BoB, offload up to 50%.
UTI Asset Management Company Ltd chairman and managing director U K Sinha told PTI that the board of the company had recently approved the proposal to offload up to 50% stake held by the four sponsors.
State Bank of India (SBI), Life Insurance Corporation of India (LIC), Punjab National Bank (PNB) and Bank of Baroda (BoB), individually hold 25% stake each in the asset management firm.
Sinha said UTI AMC would probably be the first domestic mutual fund in the country to go for an IPO, through which the four sponsors would make a partial exit.
He said the details on the valuation of the company were being worked out.
The valuation of the firm was last done in November 2005, when the four sponsors bought stake in it.

Source: PTI

Rupee world's favourite currency

NEW DELHI: Sabse bada rupaiya. The Reserve Bank of India is going to find it increasingly tough to prevent the rupee from appreciating, if the growing appetite for the rupee in different parts of the world is anything to go by. For instance, the US-based Inter-American Development Bank (IADB) raised rupee-denominated debt worth Rs 150 crore money in the Japanese market in May. The issue was of 10-year bonds offering an interest rate of 8.25%, with payments to be settled in dollars. It had raised a smaller amount for three years in February at 7.25%. The transaction is only a pointer to the growing strength of the rupee, which is fast gaining the confidence of investors across markets. The IADB floated a rupee-denominated dollar settlement issue after Japanese investors insisted on holding rupee assets, said an official. The dollar value at redemption would depend directly on the valuation of the rupee. This debt issue is significant because it was floated in a mature market, signalling that even investors in developed economies are now betting on the rupee. Says Vineet Gupta, head-local credit analysis, Calyon Bank, “Every investor wants India in his portfolio and the global demand for rupee-denominated assets will continue to strengthen. This comes on the back of high growth in the economy and the appreciating rupee.” The rupee has appreciated by a whopping 8.78% since January this year, from 44.2 per dollar on January 1 to 40.63 per dollar on Thursday. Rupee-denominated debt instruments floated outside India cannot be settled in rupees since the Indian currency is not fully convertible. The underlying valuation of the transaction is driven by the rupee even though the settlement is in dollars. This implies that at the time of settlement of the loan, the borrower will pay back the dollar equivalent of the rupee. Since the expectation is that the rupee would appreciate against the dollar, the lender expects to get back more dollars per rupee lent. For instance, if at the time of the debt issue, the rupee is trading at Rs 41 per dollar and the issue size is $100 million (Rs 410 crore) and at the time of repayment, the rupee is trading at Rs 40 per dollar, then the final valuation of the settlement will vary according to the rupee and the borrower will have to pay back $102.5 million (4100/40). Thus, an investor would opt for a rupee-denominated paper to gain from a higher dollar return at the time of repayment, owing to the appreciation of the rupee. This appreciation has led to increased demand in global markets for rupee-denominated assets. Industry sources said a couple of months ago, there was a similar issue of rupee-denominated bonds, with settlement in dollars in London to finance a takeover deal of a company. In fact, Dubai launched rupee-dollar futures contracts that will be traded on the Dubai Gold and Commodities Exchange (DGCX) on Thursday.

source: Times News Network