IBA, bank employees signs wage hike, pension benefits agreement

After much deliberation, the Indian Banks Association (IBA) has settled on a 17.5% salary hike for roughly 700,000 bank employees. IBA signed an agreement with the United Forum of Bank Unions (UFBU), an employee union comprising 9 union at the industry level and covering officers and clerical staff.

The salary hike which becomes effective from November 2007 for a period of five years, would entail additional outgo of Rs4,816 crore annually. This ninth bipartite wage negotiation settlement covers 27 public sector banks, almost all private banks and some foreign banks including Citibank, Standard Chartered Bank, HSBC and ABN Amro.
 
Besides, the agreement has also provided for pension benefits for around 332,000 serving and retired employees. The pension scheme would involve an additional outgo of nearly Rs6,100 crore from the banks. This is the second pension option for public sector banks, covering 272,000 serving employees and 60,000 retired employees who did not opt for the scheme in 1993.
 
Vishwas Utagi, secretary of the All India Bank Employees Association (AIBEA) confirmed, “This settlement would require an additional corpus of Rs6,100 crore to cover 272,000 present employees and around 40,000 retired employees. In that, employees have agreed to contribute Rs1,800 crore, which forms 30% of the corpus while the bankers would contribute the remaining balance of Rs4,200 crore.”
 
However, SBI unions refused to ink the pact stating that there interests were not being served. SBI union representatives of National Confederation on Bank Employees (NCBE) and All India State Bank of India Officers Association (AISBIOA) refused to sign the minutes of the meeting.
 
Mr Utagi added, “The SBI leadership walked away saying that this will not be applicable to them, but then the fact remains that their own organisation presidents have signed the pact. So, even though the general secretaries of these two unions did not sign, their respective presidents have ratified. Although SBI unions were negotiating along with the rest on the wages front, they had a different stand with regard to the pension scheme. SBI has a different pension settlement since the beginning, separate from the pension scheme covering other banks. They were arguing to introduce a separate clause in the settlement to enable them to improve pension system within the bank. However, both IBA and the government refused and directed them to hold talks with their management.”
 
Those employees joining public sector banks from April 2010 would be covered by the New Pension Scheme (NPS) with 10% of their basic salary and dearness allowance deducted as their contribution. Banks in turn would pitch in with the same amount.
Sanket Dhanorkar [email protected]

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Adani gets shareholders’ nod to raise Rs4,000 crore

Adani Enterprises Ltd on Friday said that it has received approval from its shareholders for upsizing the amount to be raised through share sale to qualified institutional buyers (QIBs) to Rs4,000 crore from Rs1,500 crore which was planned earlier, reports PTI.

The members of the company have given their approval for enhancing the present limit of issue of shares or instruments convertible into shares to QIBs to the overall amount up to Rs4,000 crore, Adani Enterprises said in a filing to the Bombay Stock Exchange (BSE).
 
On 18th June this year, shareholders had given their approval for issue of shares or instruments convertible into equity shares to the QIBs for an amount not exceeding Rs1,500 crore.
 
In today's shareholders meet, the company also received approval from the issue of bonus shares in the ratio of one new equity share for every one share held by investors, it said.
 
Shares of Adani Enterprises closed at Rs810.60 on the BSE, down by 1.4% from the previous close.
–Yogesh Sapkale
 
 

 

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Dubai crisis may not impact Indian realty market

A majority of big real-estate developers in India on Friday said that they are insulated from the financial crisis in Dubai and the developments in the emirate will not have any impact on the country's property market, reports PTI.

DLF Ltd, Unitech Ltd, Parsvnath Developers Ltd and Emaar MGF Ltd have all said that they have no exposure in Dubai, while Omaxe has said that it has an investment of Rs40 crore for which it has asked for a refund.
 
But consultant Jones Lang LaSalle Meghraj country head Anuj Puri cautioned that if the corporate debt default in Dubai turns into a sovereign default, there would be real economic issues, which may not only hit India but other international markets too.
 
"(The) Indian property market is very robust and largely dominated by internal demand. So there will be no adverse impact on us," DLF executive director Rajiv Talwar told PTI.
 
Emaar MGF, a joint venture between Dubai-based Emaar Properties and India's MGF, said its operations are only in India and the developments in Dubai would have no impact on its operations.
 
"Our business and funding plans are on track," a company statement said. Emaar MGF is in the process of coming up with an initial public offer.
 
"Emaar has not asked for any external support and maintains good financial strength. Emaar Properties remains committed to its investments and Emaar MGF's business in India," it added.
 
Faced with a funding crisis, the Dubai government on Wednesday had asked creditors of State-owned Dubai World and property group Nakheel for a six-month ‘standstill’ on interest payments on debts amounting to $80 billion.
 
Unitech vice president for corporate planning and strategy R Nagaraju said that Indian real-estate developers have little exposure in Dubai, so there will be no impact of the crisis.
 
Expressing similar views, Parsvnath Developers chairman, Pradeep Jain said, "I do not forsee any concern in the Indian real-estate market as it is entirely different from the Dubai property market. In India almost 100% demand is from (domestic) end-users but in Dubai only 10% is local demand."
 
Mumbai-based Hiranandani Group, which is developing a 90-storey housing project in Dubai through a joint venture with the ETA-ASCON group, said the financial crisis there will not have any impact on its operations.
 
Hiranandani Developers managing director Niranjan Hiranandani said, "Already we have sold 97% of the project and received 70% of the money. Almost 85% of the construction has been completed. The project will be completed by June next year." The company has no debt in Dubai, he said, adding, "We don't see any negative impact on ourselves".
 
Omaxe chairman Rohtas Goel said the company had made an upfront payment of Rs40 crore for two property projects in Dubai to Nakheel, but since it has been put on hold the company has asked for refund of the amount. "We hope to get a refund within one month's time," Mr Goel said.
 
The projects were envisaged to have a total cost of Rs1,500 crore with estimated revenues of about Rs2,850 crore, Mr Goel added.
–Yogesh Sapkale

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