IDBI Bank likely to raise equity capital

IDBI Bank may consider raising equity capital, thereby diluting the Govt's stake, over the next 12-15 months. The Bank will explore the options of going in for a right issue, follow-on public offer , qualified institutional payment or preferential placements for raising funds,according to its Chairman and Managing Director,Mr.R.M.Malla. The Union Govt. currently holds a 65% stake in the bank. The bank will also focus on garnering more CASA( current account and savings account) deposits,which currently stands at close to 15% of the Bank's overall deposits. IDBI Bank has done away with the concept of minimum balance on CASA accounts and has waived off most service charges, other than those pertaining to bounced cheques.(BL 06092010)

Shift to card payments to save on cash printing cost: Study

It cost the Govt. nearly Rs 2800 crore to print currency notes in 2009-10.Cash/ currency notes are the preferred mode of payment for most customers,but with printing cost on the rise, it makes sense for the Govt. to reduce usage of these notes and shift cash transactions to a card-based system of payment. Right now, a mere 5% of retail sales or about 90000 crore worth of transactions in India are done through cards(credit & debit).In other words, card transactions reduced cash transactions in the retail sector by about 5% .Given the cost of printing notes,card usage leads to savings of about Rs 140 crore(i.e,5%of Rs 2800 crore), in currency management, says a study conducted by Prof. Ashis Das, Professor of Maths,IIT Bombay.(BL 06092010)