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IMD closing date extended to Nov 4

Our Bureau

MUMBAI, Oct. 29

SUBSCRIPTION to the India Millennium Deposit (IMD) scheme is to be closed by November 4, against the earlier closing date of October 31, senior SBI officials said today.

According to the original plan, the scheme was to close by October 31. However, due to mid-week holidays, starting Wednesday, the bank decided to extend the scheme by another three or four days.

The SBI team, led by Mr G.G. Vaidya, Chairman, and Mr. Janki Ballabh, Chairman-designate, was in West Asia for three days last week marketing the scheme.

The response from NRIs in the Gulf has been good and the bank expects to garner $4-4.5 billion under the scheme, officials said.

However, the market is unsure of the response as the impact of any substantial dollar inflow has not been felt yet. The rupee has been losing against the dollar in the last week, touching an all-time low of Rs 46.76 on Friday.

The response to IMD might not be as good as that to the Resurgent India Bond (RIB) of 1998, said another banker, pointing out that the impending dollar inflow has not affected the market.

The `commission war' among foreign banks appears to have driven out at least one new Indian private bank from marketing the scheme.

Under the terms and conditions, SBI will pay each collecting bank a commission of 1.50 per cent of the funds mobilised provided the mobilisation is over $ 100 million. Additionally, the collecting banks will get a service charge of 0.25 per cent on the amount raised by them.