No savings bank rate hike for now, says SBI chief

“No major bank has increased the interest rates on deposits in SB accounts. Those who have done it are not big ones”: SBI Chairman

The State Bank of India chairman, Pratip Chaudhuri, ruled out any immediate increase in its savings bank account rate, saying that the largest Indian bank is confident of the people’s continuing trust in the various facilities being provided to them by SBI.

“No major bank has increased the interest rates on deposits in SB accounts. Those who have done it are not big ones,” he told reporters after the annual conference of SBI’s Chief General Managers (CGMs) here, when asked whether SBI plans to increase the rates in the wake of deregulation of rates by the RBI in the second quarter monetary policy review last week.

Three private sector lenders — YES Bank, Kotak Mahindra Bank and IndusInd Bank — have increased the interest rates on SB deposits by up to 200 basis points over the last few days.

Replying to a question, Mr Chaudhuri said the Government is committed to infuse capital in SBI by March 2012 and take a decision on the kind of recapitalisation needed. “It is in the process in the Finance Ministry.”

The SBI chief said it was difficult to predict whether rate hikes would curb inflation. The RBI is targeting to bring it down to 7 % by March 2012. If that happens, the central bank could possibly halt any further hike, he added.

Asked about home loan tenures, he said since the average life of a new house is seen as 30 years, SBI is considering increasing tenure of home loans to up to 30 years.

He said there was no deceleration seen in the individual home loan accounts and, in particular, the demand was robust in the premium segment. But there is stress in some sectors of economy such as agriculture, textiles, engineering and SMEs. “Any slowdown in core industries is not good for favourable collection," he said.

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J&K Bank can provide subsidized loans to farmers

Jammu and Kashmir Bank can provide subsidized loans to farmers under the Interest Subvention Scheme of the Centre as it is a public sector bank

The Finance Ministry has announced that Jammu and Kashmir Bank can provide subsidized loans to farmers under the Interest Subvention Scheme of the Centre as it is a public sector bank.

Jammu & Kashmir Bank, being majority owned by the government of Jammu & Kashmir, is also a public sector bank as per Section 617 of the Companies Act," the Finance Ministry said in a letter.

"It has therefore been decided that the Interest Subvention Scheme on short-term crop loans will also be applicable for lending done by the bank as long as the Jammu & Kashmir government retains a majority stake in the bank," it said.

The Jammu & Kashmir government owns a 53.17% stake in the bank, incorporated in 1938. The bank has 442 branches in the state and 354 ATMs.

The government of India has been implementing the Interest Subvention Scheme since 2006-07 to ensure that short-term crop loans up to Rs3 lakh are available to farmers at a concessional interest rate of 7% per annum, irrespective of the prevailing market rate. The scheme is applicable to public sector banks, regional rural banks and cooperative banks.

In his Budget speech, Finance Minister Pranab Mukherjee had said the existing interest subvention scheme for providing short-term crop loans to farmers at 7 per cent interest will be continued during FY2011-12.

“In the last Budget, I had provided an additional 2 per cent interest subvention to those farmers who repay their crop loans on time. The response to this scheme has been good. In order to provide further incentive to these farmers, I propose to enhance the additional subvention to 3 per cent in 2011-12," Mukherjee had said.

Accordingly, the effective rate of interest for such farmers will be 4 % per annum, the Finance Minister had said.

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Calcutta HC grants continuation of stay of Singur Act

While Kalyan Bandopadhyay appearing on behalf of the West Bengal government prayed that the stay be restricted to 645 acres of leased out land to the Tatas, the division bench rejected the appeal and said that stay would be applicable to the entire 997 acres

Kolkata: The Calcutta High Court today granted continuation of the stay of the trial court order validating the Singur Land Rehabilitation and Development Act which has been challenged by the Tatas, reports PTI.

A division bench of justices Pinaki Chandra Ghose and Mrinal Kanti Chaudhuri passed the order granting continuation of the stay till disposal of the appeal.

On 28th September, justice IP Mukherjee while validating the Singur Act had stayed the operation of the order till 2nd November so that any aggrieved party was able to file an appeal.

While Kalyan Bandopadhyay appearing on behalf of the West Bengal government prayed that the stay be restricted to 645 acres of leased out land to the Tatas, the division bench rejected the appeal and said that stay would be applicable to the entire 997 acres.

Tata Motors had moved the division bench challenging the order of the trial court, praying for continuation of the stay of the operation of the judgement and also the validity of the Singur Land Rehabilitation and Development Act, 2011.

The legislation provided for return of 400 acres of land to unwilling farmers who had given their holding for Tata Motor’s Nano car project at Singur in Hooghly district.

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