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Bank's association with Bombay Stock Exchange Ltd. (BSE) spans over a period of more than 8 decades with the clearing and settlement functions of the Bombay Stock Exchange Ltd., (BSE) handled by the Bank. Later on in 1989, Bank set up BOI Shareholding Ltd. as a joint venture with BSE to manage the clearing house activities of the Exchange. The company is carrying out the demat rolling settlements on T+2 basis of the Exchange through the National Securities Depository Services Ltd. (NSDL) and Central Depository Services (India) Ltd. (CDSL) efficiently and also the settlement of G-Secs through an integrated computerized system.
With a view to optimising use of its trained manpower and sophisticated IT infrastructure, besides handling settlement related work of the Exchange, the company also extends depository services to member brokers of the stock exchanges and retail investors. During 2004-05, the company commenced new business activity i.e. franking of stamp documents, which has proved to be highly lucrative and has been contributing significantly to the revenues of the company. With the corporatisation of the Stock Exchange, Mumbai and its transformation in to a corporate entity viz. the Bombay Stock Exchange Ltd. during the year, the clearing and settlement functions of BOI Shareholding Ltd. are likely to get transferred to a clearing corporation in future.
BOISL earned a net profit of Rs.309.25 lakhs during 2005-06 as against Rs.152.13 lakhs earned during 2004-05. The company paid an interim dividend of 15% during FY 2005-06 and final dividend of 45 % taking total dividend for FY 2005-06 to 60% as against 25% dividend paid during FY 2004-05.
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Securities Trading Corporation of India Ltd. (STCI)
Securities Trading Corporation of India Ltd. (STCI) is one of the leading Primary Dealers in the country enjoying the highest credit rating of P1+ by CRISIL and A1+ by ICRA for short-term debt instruments. The Bank is the single largest stakeholder of STCI with 29.95% stake in its equity.
The year 2004-05 witnessed a sudden and swift hardening of interest rates and narrowing down on margin in trading and gilt securities. As such, all major PDs including STCI incurred losses from operations. For the first time in its history, the company incurred a loss of Rs.97 crore during FY 2004-05. With diversification plan and strategies, the company made a quick turn around and earned a net profit of Rs.24 crore during FY 2005-06. During the year STCI also successfully bid for acquiring the UTI Securities Ltd. from the specified undertaking of the Unit Trust of India. With this acquisition, STCI hopes to mark its presence in the field of equity trading, portfolio management services, commodity trading , depository services etc.
STAR UNION DAI-ICHI LIFE INSURANCE CO. LTD.
Bank of India and Union Bank of India, two leading Public Sector Banks in India, and The Dai-ichi Mutual Life Insurance Company, a leading Japanese Company in the Life Insurance market, have floated a Joint Venture Company, 'Star Union Dai-ichi Life Insurance Co. Ltd." for undertaking Life Insurance Business in India.
The Company, has been incorporated / registered with the Registrar of Companies, Maharashtra on 25th September, 2007 and will be a Mumbai based Company. The Company's application for License is under IRDA's consideration. The Company is well advanced in preparation for setting up office, putting up the team and other infrastructure.
The Joint Venture Agreement, among others, envisages, a capital stake of 51% by BOI, 26% by Dai-ichi Life and 23% by Union Bank. The Joint Venture company would have initial paid-up capital of Rs. 250.00 Crore.
The Joint Venture Company, with the strength of the domestic partners in the Indian Financial Sector coupled with the Dai-ichi Life's strong domain expertise is expected, to be a strong player in the Indian Life Insurance market in a short time. The company aims to develop various products to serve all strata of the society.
Bank of India and Union Bank have a strong nationwide network of more than 5000 offices, which shall provide a sound distribution channel with a wide reach, which is the key to the success of an insurance venture. More than 48 million strong banking customer base of the two banks provides ready scope of cross selling of insurance products. The two banks have strong brand equity, and command high level of trust among their customers and people at large. Additionally the Regional Rural Banks sponsored by the two banks have more than 1400 branches to tap the life-insurance business in the rural areas.
Dai-ichi Life is a leading player in the Life Insurance Segment in Japan and is one of the Top 10 Life Insurers in the world and the second largest Life Insurance Company in Japan. Established in 1902, it has more than a century of experience in Life Insurance business. It has sound product knowledge, sharp asset management skills, and strong operational capabilities to manage Life Insurance business, which make Dai-ichi Life the best insurance JV partner on the domain side.
Star Union Dai-ichi Life Insurance Company Ltd. is also committed to providing insurance to rural and weaker / social sectors. Both the Domestic Partners are in the process of implementing Govt. of India's initiative of Financial Inclusion and their Pan India network of branches gives the Company a natural edge in catering to these sectors effectively.
With the strong brand and commitment of the partners, Star Union Dai-ichi Life Insurance Company Ltd. promises to be a new star on the horizon of the Indian Life Insurance scene, promising value to all stake holders.
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