Citi to cut 100 jobs in India

Citigroup Inc said it would cut about 100 jobs in India, where it has been expanding rapidly, while reiterating that the country remained among its highest priority markets.

The third-largest US bank by assets did not give a reason for the cuts, but a source with direct knowledge of the matter said it was part of CEO Vikram Pandit's plan to slash 4,500 jobs worldwide.

Citigroup hired more than 1,500 staff in India in 2011, the bank said in a short statement announcing the layoffs.

Citi, one of the top three foreign banks in India along with Standard Chartered and HSBC, has about 7,000 staff in the country and operates across several businesses including corporate, consumer, investment banking and wealth management.

The headcount reduction will be across all of the bank's businesses, but is not likely to include managing director level executives, the source said.

Citi expects to boost its loans and deposits growth in India by about a fifth in each of the next two years, its India head, Pramit Jhaveri, told Reuters on November 22.

Facing weak markets and tougher regulation, global banks have outlined plans to cut more than 125,000 jobs this year, according to a Reuters tally. Until recently, Asia had largely been untouched by the jobs axe.

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Lakshmi Vilas Bank hikes interest rates on NRE term deposits

Private sector lender Lakshmi Vilas Bank has hiked interest rate on Non-Resident External (NRE) term deposits with immediate effect.

The hike in interest rates on NRE term deposits was based on the deregulation of interest rates by the Reserve Bank, LVB said in a statement.

According to the revised structure, the interest rates for deposits with a period of one year and above but less than two years has been revised to 10 per cent from the existing 3.82 per cent.

For term period of two years and above, but less than three years, it has been increased to 8 per cent from 3.51 per cent (existing).

For those deposits that are up to three years and above, the interest rates has been hiked to 7 per cent from 3.64 per cent, it added.

Lakshmi Vilas Bank currently serves 1.81 million customers. It has 274 branches and 381 ATM networks across the country, the statement added.

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Rights issue is on track, says SBI chief

SBI today said its Rs 20,000 crore rights issue proposal was on track and the bank was not looking at any other options to raise capital.

"Government of India, Department of Financial Services is very much looking into it (rights issue proposal). As of now, there is no interim response (from the government) but it is receiving attention," SBI Chairman Pratip Chaudhuri said.

"There is no question of looking at any other option but rights issue is very much on the track," he said, adding, "The amount will be finalised after we hear from the government".

The country's largest bank submitted proposal for capital infusion a few weeks ago.

"We have made our proposal to the government giving different scenarios and different levels of capital adequacy which requires different levels of capital," he said.

As per the proposal, SBI requires Rs 20,000 crore to fund its growth plans over the next two fiscals.

It is also function of percentage of government's holding in the bank, he said.

Currently, the government has a 59.4% stake in the bank. In case a rights issue is approved and the government wants to retain its holding at the current level, it would need to subscribe to 59.4% of the total rights being issued.

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Bank of Maharashtra to offload Rs 9,000 crore bulk deposits by March 2012

Bank of Maharashtra (BoM) is planning to offload its entire chunk of bulk deposits of Rs 9,000 crore by March next year to control cost and preserve margin, bank chairman and managing director Anup Sankar Bhattacharya told ET.

Banks are facing rising cost of deposit as Reserve Bank of India following a tight monetary policy by raising interest rate to tame inflation.

BoM's cost of deposit stands at 5.88% while its net interest margin being at 3.18%. "We would lime to maintain NIM at 3.15-3.18% level," Bhattacharya said.

Having decided to offload bulk deposit, the Pune-based bank's deposit growth will be moderate this year at 15%. It aims to grow its advances by 18% in 2011-12.

Mr Bhattacharya said his bank has requested the government for an equity infusion of Rs 800 crore to keep tier 1 capital above 8%. "This would take care of our growth till March 2012," the CMD said. BoM has its capital adequacy ratio at 13.35%.

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