WASHINGTON: The US Export-Import Bank is considering financing a massive coal-fired power plant in India despite the fact the Obama administration has called on domestic and global public lenders to stop funding coal-plants in his climate change strategy. The board of the Ex-Im Bank, the United States’ export credit agency, voted last December to stop funding coal plants overseas - except in certain circumstances - in response to President Barack Obama’s Climate Action Plan, which called on US and international lenders to do so.

“We are currently reviewing the application, which we received last month, to determine if it satisfies our criteria of ‘reasonable assurance of repayment’ and to ensure that it adheres to our environmental and other policies,” an Ex-Im official said.

The Ex-Im bank helps finance foreign purchases of US exports. Its future is currently in question as Congress debates whether or not to re-auhtorize the 80-year-old institution, whose funding expires September 30. House Republicans are divided on the question while Democrats largely support it. Democratic Senator Joe Manchin from coal state West Virginia plans to offer compromise legislation to renew the bank’s charter by five years on the condition that it permanently removes the restrictions on lending to coal projects.

The Ex-Im Bank in January temporarily suspended enforcement of a lending ban to high-carbon intensity projects until September due to a provision of a House appropriations bill that defied the president’s climate action plan.

This opened the window for the India project to apply for an Ex-Im loan guarantee. The coal project being reviewed by the bank is a 4,000 MW integrated power plant and coal mines located in Jharkand.

It had initially been proposed by India’s government as part of a strategy to add an additional 100,000 megawatts of generation capacity by 2017. Residents surrounding the coal mining and power project have protested against it. The supercritical plant, which uses more efficient boilers than traditional coal-fired power plants, is owned by Reliance Power, Tata Power and coal mining company NTPC. —Agencies 

Investment bankers are jostling to win plum roles from the founding Lee family of Samsung Group, South Korea's top fee-payer, as it prepares to hand the baton to the next generation in a restructuring that could land more than $100 million in advisory fees alone.
Foreign and Korean investment banks are bringing in their chief executives and top dealmakers to pitch for a glut of deals as the $407 billion Samsung Group untangles an empire that ranges from electronics to financial services.
Banks' top executives have long courted the Samsung Group as it's among Asia's top fee-payers. Citigroup's chief executive Mike Corbat flew to Korea last year to meet with Samsung management, according to a source with direct knowledge of the matter, while last month Asia-Pacific head Stephen Bird travelled to Seoul.
Now, as the group's restructuring accelerates, Korean and foreign investment banks are assembling large teams, sending their CEOs to pay their dues at Samsung HQ and boosting research coverage of the group to try and win lucrative work from the conglomerate.
"There are potentially hundreds of transactions that can be done to simplify the Samsung group structure," said Shaun Cochran, head of Korea at CLSA, which published a 178-page report on the group on June 16.
As well as untangling the group's complex web of businesses, the restructuring could also ease a potential $6 billion tax bill faced by the Samsung heirs.
Unlike large Western companies that often retain a 'house' bank, bankers say Samsung keeps them on their toes by fostering competition for each and every deal as it believes it gets better service that way.
Since 2010 the group has paid an estimated $167 million in fees, the most among Korean corporates and the tenth-highest in Asia outside Japan, according to data from Freeman Consulting. So far this year, it has paid $21 million in fees, compared with $13 million for all of 2013.
Bankers estimate Samsung could pay more than $100 million in fees over the next two years.
With revenues from trading and dealmaking dwindling, global banks in Asia have culled staff and focused on cross-selling to the region's few serial fee payers.
That makes a group like Samsung, whose Samsung Electronics Co Ltd is the world's biggest smartphone maker, a top target for banks. In return, Samsung is a demanding client even by investment banking standards.
"For a one hour meeting with them, we'll do thirty man-hours of preparation so we don't waste their time," said a senior executive at a foreign investment bank in Seoul
The sprawling Samsung conglomerate, whose 2012 revenues accounted for more than a quarter of South Korea's nominal gross domestic product, appears to be accelerating a restructuring after patriarch Lee Kun-hee, 72, was hospitalized in May.
Last month, Samsung Everland Inc, a key holding company within the group, announced plans for an IPO, following a similar announcement in May by IT solutions unit Samsung SDS.
Other mandates include battery maker Samsung SDI Co's acquisition of electronics materials affiliate Cheil Industries Inc, and a potential renminbi-denominated bond for Samsung Electronics.

Two state-run banks -- Sonali and Janata -- have reduced their lending rates due to excess liquidity amid a poor demand for loans.  
The interest rate for Sonali Bank's term loans came down by 1 percentage point to 14 percent, working capital loans by 2 percentage points to 14 percent and SME loans by 3.5 percentage points to 13 percent.
Janata Bank cut lending rates by 1 percentage point to 14 percent for its term loans.
The new interest rates that took effect yesterday will help attract customers, said Pradip Kumar Dutta, managing director of Sonali Bank.
“The interest rates were cut due to a poor demand for loans and idle liquidity in the bank,” Dutta said.
As on June 30, the bank has disbursed loans worth Tk 34,000 crore and collected deposits of Tk 66,000 crore, he said.
“Our filed-level officials have been given targets to increase loan disbursement,” he added.
SM Aminur Rahman, managing director of Janata Bank, said: “We decided to cut the interest rates due to excess liquidity. Our cost of fund is also low. We are offering 9.5 percent interest on deposits.”
However, Abul Barkat, chairman of Janata Bank, called for a single digit lending rate for the sake of massive industrialisation.
“If we want to set up big industrial units in the country, we should offer single digit interest rates,” Barkat said.
The cuts in lending rates by the state-owned banks will encourage private banks to do the same, said Salehuddin Ahmed, a former governor of Bangladesh Bank.
Political uncertainty, a scarcity of gas and electricity, and poor infrastructure are some of the reasons behind the declining demand for loans, Ahmed said.
The state banks should stop being dilatory while providing services to the general people, he said, adding that the banks should select potential borrowers, including SME entrepreneurs, to speed up loan disbursement.  
“It is a good move by the state banks,” said Fahmida Akter Khatun, research director of Centre for Policy Dialogue.
She, however, said reducing the lending rates is not enough to boost investment. "We should ensure an investment-friendly environment and sufficient infrastructure.”

The law for the bank passed in parliament

The parliament yesterday enacted the law for Palli Sanchay Bank, a specialised bank for rural poor along the lines of Grameen Bank.
The version of the act passed in parliament is more or less the same as the draft law approved by the cabinet last November.
Under the Palli Sanchay Act 2014, the new bank will emerge from the government's One House, One Farm project, just as Grameen Bank was born in 1983 following the conversion of Muhammad Yunus's Grameen Bank project in Jobra village near Chittagong University.
“This bank will give an institutional framework to save money for the beneficiaries of the One House, One Farm project,” Finance Minister AMA Muhith told the parliament, adding that the purpose of the bank is to mobilise the rural people's savings.
The government wanted to set up such a specialised bank as it has lots of experience in this area, Muhith said, recalling that he himself got the Grameen Bank Ordinance passed in 1983.
The government will hold 51 percent of the bank's ownership and the remaining 49 percent would go to the 17,300 cooperative societies of the One House, One Farm project.
The law said the bank's authorised capital would be Tk 1,000 crore and paid-up capital Tk 200 crore. The cooperative societies' total fund of Tk 1,342 crore would be transferred to the new bank.
The government can raise the paid-up and authorised capital through gazette notification and the bank's head office will be located in Dhaka.
The bank's board of directors will consist of 18 members, with the chairman to be selected by the government from the board members.
Of the total, seven directors will be selected from the shareholders from the division level associations of the One House, One Farm project, each represented by individuals.
The remaining 11 posts will include: a representative from the finance division, a member of the rural development and cooperatives division, director general of the Bangladesh Academy for Rural Development and the bank's managing director.

A representative from the legislative and parliamentary affairs division, two upazila chairmen selected by the government and four experts on rural economy and macro-financing, will also be present in the board.
Palli Sanchay Bank will not be governed under the Banking Companies Act, meaning it would remain mostly out of bounds of the central bank.
But like Grameen Bank, it would have to submit reports as per 'Bangladesh Banks demands and its audited reports would be presented to the government and BB at the end of each financial year.

The managing director can be appointed from the board or from outside, with BB's approval. He/she would be allowed to serve in the position until 65 years of age, in contrast to the maximum age of 60 for Grameen Bank's MD.
The activities of the specialised bank, in many aspects, would also resemble those of Grameen Bank. Like Grameen Bank, it will collect deposits and lend to its members.
The bank will provide small loans aiming to alleviate poverty and get the rural poor into the habit of saving.
The One House, One Farm is a project under the Annual Development Programme, the first phase of which started in 1997. The second phase of the project started after the present government assumed power.

 IFIC Bank provided Tk 5 lakh to Department of Public Administration of Dhaka University on Monday to purchase computers for its library.

Shah A Sarwar, Managing Director and CEO of IFIC Bank Limited handed over the cheque to Dr. Musleh Uddin Ahmed, Chairman, Department of Public Administration at a function at the bank’s head office at Motijheel in Dhaka.