The market may open slightly lower on weak Asian stocks. Trading of CNX Nifty futures on the Singapore stock exchange indicates that the Nifty could fall 6 points at the opening bell. Asian stocks fell on Thursday before US economic reports and the European Central Bank's policy meeting.
NMDC turns ex-dividend today, 7 November 2013, for the interim dividend of Rs 3 per share for the year ended 31 March 2014 (FY 2014).
On a consolidated basis, Sobha Developers' net profit rose 12.97% to Rs 56.60 crore on 30.83% increase in total income to Rs 544.50 crore in Q2 September 2013 over Q2 September 2012. The result was announced after market hours on Wednesday, 6 November 2013.
Punjab & Sind Bank said its board will meet on 11 November 2013, to consider infusion of capital by way of preferential allotment of equity shares in favour of the Government of India amounting upto Rs 100 crore.
Wockhardt said that the UK's Medicine and Healthcare Products Regulatory Agency has allowed the company to manufacture and supply most of the products manufactured at the company's facility at Kadaiya in Nani Daman and assessed to be critical to public health. As a result the net impact on the annualised consolidated revenue is expected to be less than 1 million pounds, out of the total annual consolidated revenue of approximately 18 million pounds from the said facility, Wockhardt added.
The Reserve Bank of India (RBI) released on its website on Wednesday, 6 November 2013, the framework for setting up of Wholly Owned Subsidiaries (WOS) by foreign banks in India. The policy is released in pursuance of the announcement made in the Second Quarter Review of Monetary Policy 2013-14.
More From This Section
The policy is guided by the two cardinal principles of (i) reciprocity and (ii) single mode of presence. As a locally incorporated bank, the WOSs will be given near national treatment which will enable them to open branches anywhere in the country at par with Indian banks (except in certain sensitive areas where the Reserve Bank's prior approval would be required). They would also be able to participate fully in the development of the Indian financial sector. The policy incentivises the existing foreign bank branches which operate within the framework of India's commitment to the World Trade organisation (WTO) to convert into WOS due to the attractiveness of near national treatment. Such conversion is also desirable from the financial stability perspective. To provide safeguards against the possibility of the Indian banking system being dominated by foreign banks, the framework has certain measures to contain their expansion if the share of foreign banks exceeds a critical size. Certain measures from corporate governance perspective have also been built in so as to ensure that the public interest is safeguarded.
Banks with complex structures, banks which do not provide adequate disclosure in their home jurisdiction, banks which are not widely held, banks from jurisdictions having legislation giving a preferential claim to depositors of home country in a winding up proceedings, etc., would be mandated entry into India only in the WOS mode. Foreign banks in whose case the above conditions do not apply can opt for a branch or WOS form of presence.
A foreign bank opting for branch form of presence shall convert into a WOS as and when the above conditions become applicable to it or it becomes systemically important on account of its balance sheet size in India. Foreign banks which commenced banking business in India before August 2010 shall have the option to continue their banking business through the branch mode. However, they will be incentivised to convert into WOS because of the attractiveness of the near national treatment afforded to WOS. To prevent domination by foreign banks, restrictions would be placed on further entry of new WOSs of foreign banks/ capital infusion, when the capital and reserves of the WOSs and foreign bank branches in India exceed 20 per cent of the capital and reserves of the banking system. The initial minimum paid-up voting equity capital for a WOS shall be Rs 500 crore for new entrants. Existing branches of foreign banks desiring to convert into WOS shall have a minimum net worth of Rs 500 crore. The parent of the WOS would be required to issue a letter of comfort to the RBI for meeting the liabilities of the WOS.
Corporate Governance - not less than two-third of the directors should be non-executive directors; a minimum of one-third of the directors should be independent of the management of the subsidiary in India, its parent or associates; not less than fifty per cent of the directors should be Indian nationals /NRIs/PIOs subject to the condition that not less than 1/3rd of the directors are Indian nationals resident in India.
The branch expansion guidelines as applicable to domestic scheduled commercial banks would generally be applicable to WOSs of foreign banks except that they will require prior approval of RBI for opening branches at certain locations that are sensitive from the perspective of national security. Priority Sector lending requirement would be 40 per cent for WOS like domestic scheduled commercial banks with adequate transition period for existing foreign bank branches converting into WOS. On arm's length basis, WOS would be permitted to use parental guarantee/ credit rating only for the purpose of providing custodial services and for their international operations. However, WOS should not provide counter guarantee to its parent for such support. WOSs may, at their option, dilute their stake to 74 per cent or less in accordance with the existing FDI policy. In the event of dilution, they will have to list themselves.
The issue of permitting WOS to enter into M&A transactions with any private sector bank in India subject to the overall investment limit of 74 per cent would be considered after a review is made with regard to the extent of penetration of foreign investment in Indian banks and functioning of foreign banks (branch mode and WOS).
Weakness prevailed on the bourses for the second consecutive session on Wednesday, 6 November 2013 as a decision by State Bank of India (SBI), India's biggest commercial bank in terms of branch network, to raise lending rates by 20 basis points hurt investor sentiment adversely as borrowing costs will rise for the corporate sector. The S&P BSE Sensex lost 79.85 points or 0.38% to settle at 20,894.94 on that day, its lowest closing level since 28 October 2013.
Foreign institutional investors (FIIs) bought shares worth a net Rs 271.70 crore on Wednesday, 6 November 2013, as per provisional data from the stock exchanges.
Asian stocks fell on Thursday before US economic reports and the European Central Bank's policy meeting. Key benchmark indices in Taiwan, China, Japan, Hong Kong and South Korea shed 0.1% to 0.53%. Key benchmark indices in Indonesia and Singapore rose 0.1% to 0.58%.
China's leaders will meet in Beijing on November 9-12 to map out economic policies as the country heads for its slowest annual growth in more than two decades.
US stocks mostly climbed on Wednesday, with the Dow Jones Industrial Average notching another record close, as investors bought into optimism that the Federal Reserve would continue its stimulus longer than thought, ahead of economic reports this week on the economy and the labor market.
The US government will tomorrow, 8 November 2013, release nonfarm payrolls figures for October 2013. The job data is a key economic indicator that has been watched closely in recent months to see whether the US Federal Reserve will roll back its bond-buying program.
In Europe, the European Central Bank (ECB) holds a monetary policy meeting today, 7 November 2013. The ECB is seen retaining its key policy rate at a record-low 0.5%. The Bank of England will also announce its policy decision today, 7 November 2013.
Powered by Capital Market - Live News