LICHF says all loan approval norms duly followed

Central Bureau of Investigation arrested many top officials of financial services firms as well as public sector banks yesterday in pertanance to the housing finance scam. Amongst them was CEO of LIC housing finance (LICHF), Ramachandran Nair .

"All procedures and due diligence consistent with board approved guidelines have been adhered to in approving the loans, as has been followed in the past, by the competent authority," LIC Housing Finance said clarifying its stand.

Other than Nair, the arrested officials include Naresh K Chopra, Secretary (Investment), LIC, R N Tayal, General Manager of Bank of India (Delhi), Maninder Singh Johar, Director (Chartered Accountant) of Central Bank of India, Venkoba Gujjal and Deputy General Manager of Punjab National Bank (Delhi).

CBI also said that it has arrested Rajesh Sharma, CMD of Mumbai-based firm Money Matters Ltd and two of its employees -- Suresh Gattani and Sanjay Sharma.

LIC Housing Finance said, "All the loans are secured by the underlying assets to the full satisfaction of the approving authority. All the loans have been approved with relevant regulatory norms."

"As on date all the loans in question are performing assets," added LICHF.

CBI spokesperson R K Gaur commented on the issue saying that, "Officers of top management and middle management of various public sector banks and financial institutions viz. BoI, Central Bank of India, PNB, LIC and LICHF were receiving illegal gratifications from the private financial services company who were acting as mediators and facilitators for corporate loans and other facilities from financial institutions."

"They were also gathering confidential business information from financial institutions," added Gaur.

IDBI Bank and State Bank of Mysore raised lending rates

IDBI Bank and State Bank of Mysore have raised lending interest rates.

IDBI Bank is the first bank to raise its interest rates after the Reserve Bank of India (RBI) raised key policy rates by 25 basis points. The bank has raised its term deposit rates by 10-50 basis points across maturities to attract customers.

Bank has also revised its benchmark prime lending rate by 25 basis points to 13.5%. The new rates are effective from November 4.

IDBI Bank Chairman and Managing Director R M Malla said RBI has pointed to the issue of negative returns on deposits. He added, bank is willing to give better returns to small depositors.

State Bank of Mysore has raised its base rate by 25 basis points to 8%. According to bank statement, the revised rate has come into effect from November 1.

Central Bank to provide loan to rickshaw pullers

Central Bank of India will be providing finance for rickshaw pullers. Bank CMD S Sridhar will launch a rickshaw finance program in Uttar Pradesh capital on November 9.

Through this program the aegis of Rickshaw Federation plans to provide loans to rickshaw pullers to own their rickshaw units and thereby bringing them under the formal banking system. Sridhar will meet the state government officials regarding this.