The precious metal would be deposited with SBI which will pay interest. Interestingly, the interest will be paid in the form of gold, and not as cash.
Tirumala Tirupati Devasthanams (TTD), the custodian of the world's richest Hindu temple, has signed a pact with State Bank of India (SBI) for deposit of huge quantity of the surplus yellow metal lying in its treasury. The TTD has agreed, in the first phase, to deposit a whopping 1000 kg of gold with SBI, which is said to be the single largest ‘gold deal', both in terms of value and volume, in the history of the TTD, though it has deposited 1750 kg of gold so far in various banks.
The scheme, which is expected to be a win-win situation for both the stakeholders, is also unique in the sense that a bank is coming to the doorsteps of Tirumala to receive the gold deposits and pay interest in the form of gold.
SBI Chairman O.P. Bhat will be arriving here this week to formally receive the ‘opulent' deposit from the temple management.
While the TTD used to pay Rs.80 lakh in the past as charges towards transportation, insurance and melting (at the mint), the same will now be taken care of by the bank, thus saving a lot for the temple management. Similarly, against the paltry 0.75 p.c. previously, the TTD will now be getting 1.6 p.c. cumulative rate of interest for the five-year deposit.
Interestingly, the interest will be paid in the form of gold, and not as cash.
Though the RBI officials insist that interest shall not be paid in gold, the TTD, as a ‘privileged customer', is expected to walk away with more gold!
Showing posts with label RBI. Show all posts
Showing posts with label RBI. Show all posts
Monday, May 17, 2010
Sunday, March 7, 2010
Centre bent on bringing down prices
The Union Finance Minister, Pranab Mukherjee, has said that supply side constraints, particularly among food items, resulted in rising inflation.
Shortage of supply has resulted in steep increase in the prices of pulses and sugar, said Mr. Mukherjee while speaking to media persons at the Platinum Jubilee celebrations of the Reserve Bank of India here on Saturday. According to him, prices of cereals such as wheat and rice have gone up on account of better support prices given to farmers, resulting in cost-push inflation.
The Government has been taking steps to bring down the prices of food items. The food price inflation stood at 17.86 per cent for the week ending February 20.
Mr. Mukherjee, however, said that had the Government not offered better prices to farmers, it would have forced them to look for alternative crops other than food crops. “As a result of remunerative prices offered to farmers, food stocks are full today,” asserted Mr. Mukherjee. As part of the Platinum Jubilee celebrations, Mr. Pranab Mukherjee released the report of working group to review the credit guarantee scheme for medium and small enterprises (CGSMSE).
The report has recommended among others collateral-free loans up to Rs. 10 lakh to SMEs in a bid to ease financial requirements of the sector which accounts for 40 per cent of total industrial production.
Commending the Reserve Bank's outreach initiative “Reserve Bank Reaches Out”, Mr. Pranab Mukherjee said “Financial inclusion is an essential requirement for an equitable growth and development.”
Reserve Bank of India Governor D. Subba Rao said over the last one year, the central bank has held outreach programmes at several far off places to increase financial literacy and make people aware about policy and growth linkages.Thursday, March 4, 2010
ICICI Bank hikes auto loan rates; withdraws special home loan scheme
In a clear signal of a rising interest rate regime, country’s largest private sector lender, ICICI Bank, on Thursday said it has hiked its auto loan rates by up to 0.5 per cent and withdrawn its 8.25 per cent special home loan scheme.
“Auto loans rack rates have been raised by 0.25-0.5 per cent depending on segment and tenor with effect from March 5,” an ICICI Bank spokesperson said.
Though the bank did not give any reason for the rate hike, industry experts said that the rate increase was largely prompted by signals communicated by the Reserve Bank in its last monetary policy review.
With a view to suck out excess liquidity from the system, the RBI hiked the cash reserve ratio or the amount banks have to keep with RBI for zero interest by 0.75 per cent to 5.75 per cent, absorbing Rs 36,00 crore from the system.
Following the hike, interest rates for new auto loans will now be in the range of 9.75-11 per cent.
ICICI Bank also withdrew its special home loan scheme, under which it offered home loans for 8.25 per cent fixed rate for two years, effective from March 1, the spokesperson added.
On home loans, ICICI bank is currently offering home loans for up to Rs 30 lakh at 8.75 per cent, loans between Rs 30 lakh to Rs 50 lakh at 9 per cent and those above Rs 50 lakh, at 9.5 per cent.
Another private sector lender, Kotak Mahindra Bank and the group’s car loan financing arm also announced hikes in their home and car loan rates respectively on Thursday.
While Kotak Mahindra Bank has hiked its home loan rates by 0.25-0.5 per cent with effect from February 18, Kotak Mahindra Prime, which is the dedicated car financing arm of group, has hiked its loan rates by 0.5-0.75 per cent.
“We decided to hike the interest rates for home loans by 0.25-0.5 per cent. This is primarily to align lending rates in line with the cost of deposits,” Kotak Mahindra Bank’s Head of Retail Assets, Kamalesh Rao, said.
The bank’s home loan portfolio grew by 50 per cent in the current year, he said.
Kotak Mahindra Prime’s Chief Executive Officer, Sumit Bali, said the hike in lending rates will come in to effect from March 8. “We are hiking the lending rates as the cost of funds have gone up by up to 0.75 per cent. We have to pass on this additional cost to customers, which we didn’t do last month,” Mr. Bali said.
KMP has a total loan book of around Rs 6,500 crore, which grew by around 35 per cent in the current financial year. Moving ahead, the company expects a loan growth in the range of 15-20 per cent, he said.
“Auto loans rack rates have been raised by 0.25-0.5 per cent depending on segment and tenor with effect from March 5,” an ICICI Bank spokesperson said.
Though the bank did not give any reason for the rate hike, industry experts said that the rate increase was largely prompted by signals communicated by the Reserve Bank in its last monetary policy review.
With a view to suck out excess liquidity from the system, the RBI hiked the cash reserve ratio or the amount banks have to keep with RBI for zero interest by 0.75 per cent to 5.75 per cent, absorbing Rs 36,00 crore from the system.
Following the hike, interest rates for new auto loans will now be in the range of 9.75-11 per cent.
ICICI Bank also withdrew its special home loan scheme, under which it offered home loans for 8.25 per cent fixed rate for two years, effective from March 1, the spokesperson added.
On home loans, ICICI bank is currently offering home loans for up to Rs 30 lakh at 8.75 per cent, loans between Rs 30 lakh to Rs 50 lakh at 9 per cent and those above Rs 50 lakh, at 9.5 per cent.
Another private sector lender, Kotak Mahindra Bank and the group’s car loan financing arm also announced hikes in their home and car loan rates respectively on Thursday.
While Kotak Mahindra Bank has hiked its home loan rates by 0.25-0.5 per cent with effect from February 18, Kotak Mahindra Prime, which is the dedicated car financing arm of group, has hiked its loan rates by 0.5-0.75 per cent.
“We decided to hike the interest rates for home loans by 0.25-0.5 per cent. This is primarily to align lending rates in line with the cost of deposits,” Kotak Mahindra Bank’s Head of Retail Assets, Kamalesh Rao, said.
The bank’s home loan portfolio grew by 50 per cent in the current year, he said.
Kotak Mahindra Prime’s Chief Executive Officer, Sumit Bali, said the hike in lending rates will come in to effect from March 8. “We are hiking the lending rates as the cost of funds have gone up by up to 0.75 per cent. We have to pass on this additional cost to customers, which we didn’t do last month,” Mr. Bali said.
KMP has a total loan book of around Rs 6,500 crore, which grew by around 35 per cent in the current financial year. Moving ahead, the company expects a loan growth in the range of 15-20 per cent, he said.
Friday, January 29, 2010
Higher vegetable prices push up food inflation
After dipping marginally for a few weeks in a row, food inflation changed tack yet again to move up to 17.40 per cent for the week ended January 16 from 16.81 per cent in the previous week, mainly on account of higher prices of eggs and vegetables.
The official data on wholesale prices of primary food articles and fuels, coming as it did a day ahead of the third quarterly review of credit policy on Friday, dashed all hopes of any early respite from high food inflation which had touched its 10-year peak of close to 20 per cent in December last.
In the event, although the current bout of food inflation is more of a supply-side problem, the Reserve Bank of India is likely to signal a further monetary tightening by hiking some of the key policy rates to suck out excess liquidity and thereby rein inflation.
The general expectation among analysts is that the apex bank would raise the cash reserve ratio (CRR) — the chunk of deposits that banks are mandated to park with the RBI — by at least 50 basis points so as to suck out more than Rs.20,000 crore from the money in circulation. Alongside, there could also be a marginal increase of about 25 basis points in the repo (short-term lending to banks by RBI) and reverse repo (short term borrowing) rates to signal a staggered exit from the soft money policy.
Such a step is deemed necessary as there are chances of the high food inflation seeping into the manufacturing and other sectors and thereby lead to a surge in overall inflation.
The official data on wholesale prices of primary food articles and fuels, coming as it did a day ahead of the third quarterly review of credit policy on Friday, dashed all hopes of any early respite from high food inflation which had touched its 10-year peak of close to 20 per cent in December last.
In the event, although the current bout of food inflation is more of a supply-side problem, the Reserve Bank of India is likely to signal a further monetary tightening by hiking some of the key policy rates to suck out excess liquidity and thereby rein inflation.
The general expectation among analysts is that the apex bank would raise the cash reserve ratio (CRR) — the chunk of deposits that banks are mandated to park with the RBI — by at least 50 basis points so as to suck out more than Rs.20,000 crore from the money in circulation. Alongside, there could also be a marginal increase of about 25 basis points in the repo (short-term lending to banks by RBI) and reverse repo (short term borrowing) rates to signal a staggered exit from the soft money policy.
Such a step is deemed necessary as there are chances of the high food inflation seeping into the manufacturing and other sectors and thereby lead to a surge in overall inflation.
