SBI will take a decision next month on its proposed overseas bond issue and the amount to be raised through the issue. Managing director for international banking, Hemant Contractor said it would be a ‘benchmark issue’, which normally means the minimum issue size would be of at least $500 million
Mumbai: State Bank of India (SBI), the country’s largest lender which was recently downgraded by ratings agency Moody’s will decide on an over $500 million bonds issue next month, reports PTI.
“That’s a call we would be taking in November ... whether to go for it at all, and if we do decide to go in, then the extent of the amount,” the bank’s managing director for international banking, Hemant Contractor, told reporters on Friday.
He said it would be a ‘benchmark issue’, which normally means the minimum issue size would be of at least $500 million.
The bank had earlier announced it would double its MTN borrowings to shore up the Tier-II capital to $10 billion this fiscal.
SBI chairman Pratip Chaudhuri had in September hinted at raising over $1 billion in November, but sounded sceptical following the downgrade by Moody’s.
On 4th October, Moody’s Investors Service had cut the rating on SBI’s financial strength to ‘D+’ from ‘C-’ and pointed to issues with asset quality and lower capital adequacy.
Ratings downgrades usually increase borrowing costs for financial institutions.
Mr Contractor said the rates had gone up in international markets due to lower liquidity conditions, but did not answer when asked if the downgrade would have a bearing on the bank’s plans.
However, despite the rising costs, customers still have an appetite for loans given the interest rates differentials between the rupee and dollar borrowings, he said.
On expectations from the RBI’s monetary policy meet on Tuesday, Mr Contractor declined to give a specific answer, but hinted the bank might not be passing the hike on to borrowers if RBI again raises key rates.
“Till now we have passed on (rate hikes to customer), but we have to look at asset quality and things like that....With credit growth slowing, the ability of banks to pass on is also a little limited.”
On the bank’s international operations, Mr Contractor said the asset quality had grown by up to 13% this fiscal and the bank was not facing much the impact of the slowdown in major economies.
“Our business is India-centric and domestic economy is growing, so we are not impacted,” he said.
The bank opened a branch in Saudi Arabia’s Jeddah last month and is planning to open one in Qatar next month, he said.
SBI on Friday launched a Saudi riyal-denominated prepaid debit card, aimed at business travellers and Haj pilgrims.
The riyal is the seventh currency to be offered on prepaid card by the bank, which is now planning to introduce Singapore dollar soon, Mr Contractor said.
A senior SBI official said the bank has been clocking deposits of $100 million annually on the international prepaid cards business.
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There is much that needs to be done to make the new Motor Vehicles Act more fully representative to meet the aims and aspirations of larger segments of road users, than just catering to the various lobbies that seem to have sprung up and influenced the ‘suggestions’ put forward by ‘expert’ committees
There is a very interesting document up on the Internet, which pertains to all of us who are in any way out on the roads, in any form whatsoever. The term “road user”, misused for quite some time thanks to a Motor Vehicles Act as well as governance which both together appeared to provide higher rights to owners and operators of private cars and bikes, has been up for serious change for quite some time now, with a new Motor Vehicles Act—aimed at being up to date, and in keeping with certain new realities.
And this is what it is in its current form:
Briefly, this is the report of the Expert Committee on review of the Motor Vehicles Act, submitted in January 2011, and this is being debated, contested, whittled down—and in all probability, realigned to fit in with the various interest groups. If you look closely, you will find that the interests of the manufacturers, the road-building lobby and the perpetuation of the “authority” influenced roadside hafta regime—have all been looked after.
Except those of the true road users in India—you and me, trying our level-best to reduce our cost of living as well as seeking a cleaner environment with minimal fuss and stress. And of course, decent mobility—in reasonable safety, comfort and maybe some privacy. We are still prime targets number one, in everybody’s sights. And we don’t have a lobby.
While the “expert committee” report itself runs into 402 pages, and in its wisdom is aligned in such a way that some pages are in ‘landscape’ mode while others are in ‘portrait’ mode, making online reading an even more onerous task, there are, and were, some specific parts which were supposed to relate to the whole concept of making public transport better and easier for the majority of road users in the country—people who travel by cycles, rickshaws, buses or taxis or other forms of public transport. These recommendations, apart from having a salutary effect on environmental issues by way of lesser emissions as well as reducing road congestion, are also aimed at having an even more important side-effect—a reduction on the load on your wallet by way of making it easier and cheaper for you and me to use public transport instead of private.
However, many of the pro-public transport steps which were going to benefit a large number of road users appear to have simply been diluted or removed altogether, in these recommendations. As with all matters which appear to have a public interest, but end up working against the interests of specific lobbying groups, there is no explanation on why certain proposals were removed. Truth is to be found, increasingly, in what is not published lately.
1) While the definition of "stage carriages" has been suitably amended to bring it into line with other definitions, the proposal that licensed and authorised stage carriages were to be exempted from high rates of tolls and entry taxes in the larger social good has been done away with. For those of us who have spent hours at toll booths and local tax barriers while the bus driver and conductors do their paperwork and pay money which eventually reflects in higher fares, the sight of private cars whizzing past without a worry in the world, is what motivates people away from public transport.
2) Public passenger transport which needs to operate across local borders—municipalities, towns, cities, districts and states—are still being subjected to a complicated system of permits and permissions. Most of which end up requiring influence of the political sort, let it be said openly, as it is a public secret. The cost of these inefficiencies, which could have been reduced if it was set for simply open competition of the transparent-bidding sort, as per a proposal, only adds to costs of travel for the segment of road users—the poor and the middle class—who need it the most. Again, absent.
3) A "National Register" for driving licences issued anywhere in India, as per a proposal, would have removed the onerous tasks of getting fresh driving licences even for people operating private vehicles. All you would need to do if you moved within the country would be to update address details. However, what appears here is that the "unique driving licence number" on a national basis shall now be introduced, but any time you, the road-user, shift your residence, you will need to get a fresh driving licence with updated address details.
4) Likewise, a "National Register" for automobiles, which already exists by way of a unique VIN number that is on every motor vehicle manufactured, would have gone a long way in making life easier for people buying and selling motor vehicles. For one, a complete history would be available, from pre-manufacture state onwards. For another, a change in ownership, address, registration number or any other change would follow this nationally valid number throughout. Again, it seems to have been done away with, and whispers say that this was at the behest of the influential stolen vehicle lobby, and that was the end of "number portability".
5) A proposal requiring standardisation of hand and stalk controls to comply with right-hand drive requirements, setting specifications for safety appliances like airbags and seatbelts, and other design-specific aspects have simply been removed. Again. The one on standardising hand controls is specially important—some manufacturers, especially those of European origin, continue to provide left-hand drive controls on cars sold in India, which in any way you look at it, is unsafe. In a typical RHD vehicle, the indicator stalk is on the right side, and the wiper on the left.
6) There appears to be almost close to nothing in the proposed Motor Vehicles Act when it comes to the rights and responsibilities of cyclists, pedestrians, animal-drawn vehicles, cycle-rickshaws and other categories of road users. Who, whether defined or not, do make for a huge segment of road users—probably the largest. This is supposed to be India’s Motor Vehicles Act, and part of the brief is to cover the interests of all road users—so maybe the Act itself needs to be re-named? After all, a large number of renewable energy vehicles in the near future are simply not going to fit into the present definition of "motor vehicle" too.
There is much that needs to be done to make the Motor Vehicles Act more fully representative to the aims and aspirations of larger segments of road users than just catering to the various lobbies that seem to have sprung up and influenced the "suggestions" put forward by the "expert committees". It is time more of us who are road users in various categories stood up and put our views across. Or sit back, and see the roads being taken over by private transport, stuck in our traffic jams.