MUMBAI: Real estate loans grew 100% between June ‘05 and June ‘06, despite RBI raising the risk weightage on such loans to discourage banks funding builders, reports Our Bureau.

The risk weights were raised twice since June’05, keeping in mind the adverse balance sheet implications in the event of a meltdown in property prices. RBI has also advised banks to have board mandated policy for their real estate exposures.

According to the annual report, loans to commercial real estate rose 102% year-on-year (y-o-y) as at end June ‘06. Retail lending rose 47% in the 12 months to June’06, with growth in home loans being 54%. The y-o-y growth in industry and agriculture was 27% and 37% respectively, as of end June’06.

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The country’s largest bank, State Bank of India’s (SBI), venture fund initiatives have been put on a fast track. 
 
The bank’s investment banking arm, SBI Capital Markets (SBI Caps), is now in talks with global investors for setting up two more venture funds – a buy-out fund and an SME fund – as it formally announced launch of its maiden fund jointly with Softbank Investment, a part of Japan’s SBI Holdings group. The $100 million venture fund would target companies in the knowledge sector. 
 
These two funds will be part of SBI Caps’ plans to get into risk capital space a in big way. SBI Caps was in discussion with global venture fund players having skills and financial strength. 
 
The SME fund would seek to invest in medium-sized companies (with turnover Rs 25-400 crore) gearing up for becoming Rs 1,000 crore companies. 

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KOLKATA: The Association of NSE Members of India (ANMI) has sought finance minister P Chidambaram’s intervention with regard to price sensitive information being disseminated by stock exchanges as per the Sebi disclosure norms.

Among other disclosures, ANMI members feel market regulator should take steps to ensure that foreign institutional investors (FII) investment figures are disclosed scrip-wise on a daily basis instead of the current disclosure of gross sale and purchase figures.

Speaking to newspersons after the meeting of the board of directors held in Kolkata on Saturday, ANMI president Vijay Singhania said: “In a recent meeting with finance minister, we have drawn his attention to a need for more detailed and frequent dissemination of price sensitive information’s especially those relating to FII investments and the shareholding pattern of the companies.”

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MUMBAI: Principal PNB Life Insurance, the proposed four-way insurance JV, is looking at a low-cost distribution model that will enable the company to achieve a break-even in five years.

Principal Financial Group has partnered with Punjab National Bank, Vijaya Bank and Berger Paints for this insurance venture. Speaking about the proposed company’s business plan, Campbell Tupling, COO of Principal Group Financial, said that the company will sell to individuals through broad-based group products. “We will not have the traditional agency-driven endowment product business,” said Mr Tupling.

The group products will be distributed through alternate channels including the life company’s shareholders and its insurance broking subsidiary. The company will also target employees of corporations through work-site marketing and relationships with employers.

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MUMBAI: City developers are divided over the Centre’s proposed move to reduce the minimum area criteria for Foreign Direct Investment (FDI) for both commercial development as well as residential projects.

The government is contemplating reducing the minimum area criteria to 10,000 square meters for commercial projects from 50,000 square meters and to 10 acres from 10 hectares for residential projects, according to a media report.

While Hiranandani constructions opposed the proposed move and prefers to stick to the existing norms, Orbit Group said it had no reservations.

"The government wants FDI in larger projects. I had a meeting with various ministries in the Union Government only two to three weeks ago. They are opposed to FDI in smaller projects," Niranjan Hiranandani, Managing Director, Hiranandani Constructions Pvt Ltd told media here on Thursday.

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Mumbai: International Finance Corporation, the private sector window of the World Bank, proposes to invest $500 million in India this fiscal, a 25 per cent rise from its exposure of $400 million last fiscal (July 2005 to June 2006).
"The exposure of IFC in the South Asia last fiscal stood at 506 million dollars, of which over 400 million dollars was invested in India alone", IFC South Asia Portfolio Manager Colin J Warren said he said.

The key sectors which IFC is investing include pharmaceuticals, infrastructure, auto components, IT and Biotechnology. IFC sees great potential for biotech and pharmaceutical sectors in India’s economy.

IFC has invested in APIDC Biology Fund, which in turn will make equity and equity-related investments in emerging life science businesses. IFC has also invested in Bharat Biotec India Ltd, a company that develops and manufactures vaccines and drugs.

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