After being in the red for three consecutive sessions, in the wake of the controversy over the SEBI’s proposal on P-Notes, the BSE-Benchmark Sensex ended positive on Monday.

The Sensex gained 54 points and closed at 17613.99. By Friday, when the index closed at 17559.98, it had lost almost 1,500 points from 19,174.45.

The FIIs were net sellers on Monday, but there was some amount of buying from the local f Fresh fundsunds. However, smaller FIIs seem to be getting out of the market, thus affecting the liquidity, said a dealer with the Emkay Institutional Dealing Desk.

FII net sellers

FIIs were net sellers to the tune of Rs 1,290 crore, according to the provisional data available on the NSE.

As per the SEBI, FIIs have been net sellers to the tune of Rs 3,215.50 crore, these are the trades conducted on and up to October 19.

Market men believe that the SEBI norm is going to hit hedge funds, and in short-term it will have serious liquidity impacts.

“The FIIs have calmed down a bit after today’s meeting, although all their concerns might not have been addressed yet. But it seems as though most of the FIIs are willing to register themselves,” said Mr Sanjay Someshwar, sub-broker, Ventura Securities.

Fresh funds

“There are fresh FII applications for registration, which could bring in fresh funds to the market. This is seen as a positive element by the market participants,” said a technical analyst with a broking firm.

“Till Tuesday, rollovers were below average because of the impending SEBI meeting, but we will have to see the rollover positions happening from Tuesday onwards as they will be indicative of the future trends in the market,” said Mr Aalap Shah, Derivative Analyst, Dolat Capital Market Pvt Ltd.

Among the sectoral indices, BSE-BankEX was up 2.17 per cent, consumer durables and capital goods were also up 0.52 per cent and 0.90 per cent, respectively.

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Service oriented architectures and web services can provide real benefits to the finance industry says Julian Dobbins, senior marketing development manager at Micro Focus.

The reported increased profitability in the US and Europe suggests that retail banks are meeting the challenges of recent years.

They appear to have avoided the worst effects of major corporate collapses and increased regulatory demands, as well as the challenges posed by a more demanding and cost aware consumer.

Yet the ongoing and repercussive effect of these and other issues is changing the nature of the competitive landscape for good. The result will be a banking industry that has to be quicker, smarter and far more cost efficient in order to survive.

Paper transactions are being replaced by low margin electronic traffic. Key initiatives favour real time or T+1 transfer and settlement, necessary to aid liquidity and meet consumer demand. Those who can afford the investment have become revenue-generating hubs for second and third tier banks.

By achieving technological supremacy in transaction processing, they have leveraged their financial strength and considerable scale to enhance their competitive standing.

Sarbanes-Oxley insists that all US organizations have visibility and control of key functions. To enable this, a major operator must maintain fast and efficient global connectivity, and re-align business reporting and approval processes to successfully monitor enterprise risk, ideally from a centralized point.

The challenge for all banks, large and small, is not only to create a centre of excellence with established international standards of communication, but also to reconstruct and automate their business processes to maximize efficiency.

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The past five years were heady times for financial services companies as they lent money out at low interest rates to home buyers and corporations alike and watched profits soar.

Bank stocks climbed as the firms cashed in on a booming housing market. Strong merger activity, led by private equity firms borrowing money to finance deals, also boosted demand for loans.

But when it became apparent a few months ago that many banks handed out too much money too easily and that some borrowers weren’t able to pay back their loans, the market panicked.

Companies like Countrywide (Charts, Fortune 500), a big mortgage lender that had lots of subprime borrowers — borrowers with less-than-perfect credit — were hit the hardest, but even those with less exposure to the subprime housing market weren’t spared by the sell-off.

And now, the market is worried that the corporate debt market could also be heading into trouble, fueling further fears of a looming banking crisis.

But is this already priced in the shares of many bank stocks? The recent panic may have created some great values for investors.

Investment banks tank……!

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National Bank reported net income of $233 million in the second quarter of fiscal 2007, an increase of nine per cent over the same period last year, largely on the back of higher profits in its financial markets and wealth management segments.

Canada’s sixth largest bank reported Thursday that diluted earnings per share were $1.40, up 11 per cent from $1.26 in the second quarter of 2006. Had it not been for the net gain on the sale of its shareholder management business in the second quarter of 2006, the increase in diluted earnings per share would have been 14 per cent, the bank added.

Between the second quarter of 2006 and the second quarter of 2007, total revenues grew nine per cent to $1.02 billion, while return on common shareholders’ equity stood at 20.3 per cent.

“Standing here on my last day as head of the bank, I am very satisfied with how the bank fared during the quarter. It exceeded all of its profitability objectives with strong contributions from all segments,” said Real Raymond, outgoing president and CEO.

Incoming president and CEO Louis Vachon said he feels the financial institution is in an excellent position to continue its trend of profitable growth.

“National Bank has once again demonstrated the value of its growth strategy based on a balance between its three core areas of expertise: personal and commercial banking, wealth management and financial markets. Over the coming quarters, the segments’ strategies will be brought up to date to enable the bank to further strengthen its presence in its priority markets and exceed the expectations of all parties that have a stake in its success.”

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Moody’s Investor Service has changed the outlook to positive on South African banks’ Baa1 foreign currency long-term bank deposit ratings and foreign currency long-term issuer ratings of two development institutions. This action follows Moody’s earlier change in outlook on the country’s ceilings for foreign currency bank deposits and foreign currency bonds.

Société Générale Corporate & Investment Banking and Brait Specialised Funds, the provider of hedge fund solutions to institutional investors, has launched a leveraged certificate on the Brait Absolute South Africa Fund. The certificate provides dollar exposure to the SA hedge fund industry for European high net worth individuals and it also gives them easy entry to the South African market, which has been difficult to access due to regulatory barriers.

Resolution Health Medical Scheme has had its “A” rating reaffirmed by rating agency Global Credit Rating. The agency says the scheme’s %E

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If you have begun to research investing, then it is a sign that you are interested in taking full responsibility for your financial state in general. The first step in doing so is to examine your financial status in four different categories: income, expenses, assets, and liabilities.

Income and expenses are pretty straightforward. Income is the money that is coming into your account, and expenses are the money that is going out. If you are responsibly budgeting, then you have more income than expenses, allowing you to invest the excess. However, many of us in this day and age are living beyond our means, using credit as a way of making up the difference between what we spend and what we earn. For many people, this means that investing is difficult due to irresponsible spending habits.

Assets are those items or funds that you own. These could be funds that you have invested, or property that you own. You should be aware that some assets are actually likely to depreciate in value, such as cars. And that if you are making payments on your car, you will not get all of that money back if you were to sell it. However, your home is hopefully an asset that is appreciating, or growing in value. In this case, you can count the equity in your home as an asset. In contrast, liabilities are those amounts that you owe, including the debt that you have. The total of your assets, minus the total amount of liabilities that you owe, gives you a picture of your net worth. For many of us, it is shocking to realize that our net worth may actually be a negative number, simply due to the amount of financial liabilities that we have incurred.

So one of the easiest ways to invest, at least if you are just beginning, is to simply invest in your financial health by paying off your debt. For example, start by looking at the bills that you are paying on a monthly basis. Are any of them credit cards of payment plans of some kind? What are the percentage rates that you are paying on those debts? If you were to sit down and calculate the total amount of interest that you are paying in a month, you may be shocked to learn the amount of money that you are actually throwing away by carrying that debt. To stop throwing that money away, concentrate on paying down the debt.

While making minimum payments is the requirement of the credit company, it is also their way of keeping your account open by encouraging you to pay a smaller amount than you could. The longer you carry a balance, the more money that they make. So start by identifying which accounts have the highest interest rates (or have the largest balances and so are costing your more in finance charges), and pay as much as possible on that account while continuing to pay the minimum amount on your other accounts. When you have paid off that debt, move to the account with the next highest interest rate and do the same. Eventually, you will have decreased your liabilities greatly, and can then focus on investing in ways that will add to your assets as well.

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