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RBI moves to stem Re slide; ups FCNR rates
Gold soars on renewed demand
Allahabad Bank Q4 net up 55.4%
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ADB to provide $6.25 billion project aid
Investor Guidance
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RBI moves to stem Re slide; ups FCNR rates
Mumbai, May 5
With regard to foreign currency deposits, the RBI said, “interest rate ceiling on Foreign Currency Non-Resident FCNR (B) deposits of banks has been raised from 125 basis points (bps) (1.25%) above the corresponding LIBOR or swap rates to 200 bps for maturity period of one year to less than three years, and to 300 bps for maturity period of three to five years.” For one year LIBOR (London Inter-Bank Offered Rate) stood at 1.0472%. LIBOR is the world's most widely used benchmark for short-term interest rates. In another notification, the central bank said: “It has been decided to allow banks to determine their interest rates on export credit in foreign currency with effect from May 5, 2012.” Besides these measures, the RBI is also reported to have intervened in the forex market by selling dollars. — PTI
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Mumbai, May 5
Standard Gold (99.5 purity) rose by Rs 100 to conclude at Rs 29,310 per 10 grams from Friday's closing level of Rs 29,210 per 10 grams. Pure gold (99.9 purity) also went up by a similar margin to end at Rs 29,440 per 10 grams from Rs 29,340. Silver ready (.999 fineness) surged by Rs 400 per kg to close at Rs 56,450 as against Rs 56,050 on Friday. In New York City, gold futures jumped on disappointing US job data, reigniting possibility of further monetary easing measures amid political uncertainties in the eurozone countries. Gold for June delivery added US $10.40 to $1,645.20 an ounce on the Comex division of the New York Mercantile Exchange (NYMEX) late on Friday. Silver for July contract gained 42 cents to settled at $30.43 an ounce. — PTI
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Allahabad Bank Q4 net up 55.4%
Kolkata, May 5 During the quarter, operating profit of the bank rose by 15.52% at Rs 901 crore as compared to Rs 780 crore in the year-ago period. Net interest margin during the quarter stood at 3.23%. During the full year ended March, 2012, the bank's total business stood at Rs 2.71 lakh crore. — PTI |
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ADB to provide $6.25 billion project aid
Manila, May 5 "ADB's three-year country operations business plan for India for 2012-2014 will provide lending assistance of $6.25 billion to support inclusive and environmentally sustainable growth," ADB secretary Robert Dawson said. The lending support will go to key areas like transport, energy, urban development, agriculture natural resource management, finance and education. Meanwhile, Finance Minister Pranab Mukherjee said government is committed to bringing down subsidies to below 2% of India’s GDP in the current fiscal and cut it further to 1.75% in the next three years. — PTI, IANS |
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Investor Guidance Q: I've invested in a Fixed Maturity Plan of a mutual fund. According to the MF, if one invests for 90 days under the dividend option the dividend will be totally taxfree. Does this mean it'll be like taxfree bonds and no tax will have to be paid on the dividend amount credited to my account? Also, the capital will be returned to me at the end of 90 days (in the dividend option) and won't attract short-term capital gains tax. Am I correct? — Protul Ghosh A: Your capital in the fund that’ll be returned to you at the end of 90 days is a capital receipt and isn't taxable. The dividend too isn’t technically taxable. However, it's not taxfree in the way taxfree bonds are. The reason is that though the dividend per se is taxfree, the fund pays a dividend distribution tax of 12.5% to the government before the payout. In other words, on account of this tax (that is paid by the MF directly) you receive that much lesser dividend. So in effect it's the investor who bears the tax burden, though paid by the MF. Q: My mother subscribed to the share capital of a private limited firm in 1985 and was allotted shares at their face value of Rs 100. Last week the company was wound up and the value per share paid to each shareholder was Rs 2,000. Will the capital gains be taxfree and, if not, how much will be the tax ? — Sadgopan R A: I this case capital gains, though long-term in nature, won't however be tax free. Long-term capital gains are tax free only if the shares are sold on a recognized bourse. Even the concessional 10% rate wouldn't be available, since it is applicable only to listed securities. Capital gains in this case would be taxable @ 20% after reducing the indexed cost from the sale price. Q: I trade in futures and options and am also earning Rs 75,000 a year by working in a part time job. My income/profit from this would be business income. So am I right in assuming I won't have to pay tax if this is below Rs 1.80 lakh? — Shreyash Zhene A: Yes, that is correct. If your total income including that from your job and profits from F&O is below the basic tax threshold, there is no tax liability. Note that the Rs 180,000 limit was applicable for the last fiscal year. For FY 2012-13 the budget has enhanced the limit to Rs 200,000.
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In another notification, the central bank deregulated interest rates on export finance, a development that would help exporters to freely raise money in foreign currency without any limit on interest ceilings. The moves are aimed at arresting the declining value of the rupee that closed at Rs 53.47 against the dollar on Friday.
Silver prices also shot up on the back of frantic speculative demand amid higher industrial support.