RBI allows cash withdrawal from merchant banker terminals
Besides ATMs, customers can now also withdraw cash up to Rs1000 from terminals at different merchant establishments, the Reserve Bank. As a further step towards enhancing the customer convenience in using the plastic money, it has been decided to permit cash withdrawals at POS (point of sale) terminals. To start with, this facility will be available for all debit cards issued in India, up to Rs1000 per day," RBI said in a statement issued here. The use of debit cards at POS terminals at different merchant establishments has been steadily increasing, it said. This facility is available only against
debit cards issued in India.
At present cash withdrawal facility using plastic cards is available only at Automatic Teller Machines (ATMs) with the number of ATMs in the country at 44,857. There are 4,70,237 POS terminals in the country. This facility may be made available at any merchant establishment designated by the bank and would be available whether the card holder makes a purchase or not.
Morgan Stanley makes i-banking comeback
The joint venture between JM Financial and Morgan Stanley was inked in 1997 and formalized in 1999. The JV had investment banking operations
other than equity broking, research, wealth management and advisory and securities distribution operations. Post the split, JM Financial acquired the investment banking company together with its subsidiaries, which were engaged in fixed income, equity broking, wealth management, advisory and distribution businesses of $ 20 million. The Indian partner sold its 49% holding in JM Morgan Stanley Securities (JMSPL), the institutional equity broking company to Morgan Stanley for $ 445 million.
Bulge bracket investment banking major, Morgan Stanley has re-entered investment banking business on its own, after parting ways with JM Financial — its former Indian partner.
PNB aims profit of 7,500crore by 2013
The country's second largest public sector lender Punjab National Bank aims to double its profit to Rs7,500 crore in the next four years. "The bank has set a target to expand total business to Rs10crore and earn net profit of Rs7,500 crore by 2013," said PNB Chairman and Managing Director K C Chakrabarty, who is charge of Deputy Governor of RBI.
The growth driver would be better asset liability management, thrust on recovery, focus on customers and financial inclusion, he had said. Besides, the bank plans to open new line of businesses in the current fiscal including
merchant banking subsidiary.
PNB Investment Services aims to provide investment consultancy and merchant banking services and would be operational in the next three months. Currently, these operations are run by a division of the bank.
ICICI bank and its merchant banking arm, ICICI Securities (I-Sec), have entered into an agreement, whereby all M&A deals will be done out of ICICI Bank. The agreement goes on to define an M&A deal as one which involves change in management control.
This arrangement replaces the earlier practice of both I-Sec and ICICI Bank working together on M&A deals. “Since a predominant number of people, who wish to be advised on M&A, also look for acquisition finance, it was decided that the business should be housed in the bank,” I-Sec MD Madhabi Puri Buch told ET. “Now, if a corporate is seeking a sell mandate or a buy mandate, where the transfer of controlling interest takes place, the deal will
be done by ICICI Bank.”
ICICI Bank had initially entered the investment banking space in 2006. Over the past couple of years, both the bank and its subsidiary have been vying for deals. The new deal has taken into effect between both the entities from April 1.
Birla Capital and Financial Services gets SEBI merchant banking license
Birla Capital & Financial Services Ltd has been granted a merchant-banking license by the Securities and Exchange Board of India. The license will enable the company to offer a wide range of on-shore investment banking advisory and underwriting services in the Indian market. The company, which is a part of the Yash Birla conglomerate, will initially concentrate on regulated services like initial public offerings, takeover,
buybacks, delisting and valuations. It also offers non-regulated services like PE Syndication, M&A Advisory and other corporate advisory. Birla Capital & Financial Services Ltd. is part of the 3,000-crore Yash Birla Group that has diversified interest in sectors like auto & engineering, textiles & chemicals and power & electrical, education & IT.
Primary market slowdown, affects merchant bankers’ wallet
The recent slowdown in the primary market has impacted not only investors but merchant bankers as well, as there has been a significant decline of nearly 60 per cent in their percentage fees so far this year. "There is a clear drop in the merchant banking fees to Rs 216crore in comparison to Rs. 771crore for the calendar year 2007, indicating a drop of 57.9 per cent on annualized basis," Nexgen Capitals, the merchant-banking arm of brokerage firm SMC Global Securities. Merchant bankers are those who advise the issuer about the public offer and
manage the issue.
The average percentage fees has declined to 1.21 per cent so far this year from 2.24 per cent in 2007, the report added. Reliance Power IPO of Rs 11,563 crore during this year with the merchant banking fee of Rs 50.6 crore, amounting to 0.44 per cent of the issue size had a great bearing on this trend.
Nomura Financial Advisory and Securities (India) Private limited ('Nomura India'), a wholly-owned subsidiary of Nomura Holdings, Inc. ('Nomura'), has launched its equity sales and trading and investment banking operations
in India.
In October 2008, Nomura, a global investment bank, acquired the majority of Lehman Brothers' employees in India, including the equities sales and trading, equity research, fixed income liquid markets sales and trading, and
investment banking teams.
By integrating the former Lehman Brothers India franchise and obtaining its merchant banking licence and stock exchange memberships, Nomura India said in a statement it has significantly expanded its capabilities in India through a wide range of onshore financial solutions spanning securities brokerage, securities underwriting and advisory services.