The Hindu Business Line : Canara Bank to expand commodities exposure

CANARA Bank, in a major initiative to increase exposure to the growing commodity sector, has entered into a memorandum of understanding (MoU) with National Collateral Management Services Ltd (NCMSL), a Mumbai-based company offering risk management solutions in the area of commodities and inventories.

The MoU is aimed at bringing the two institutions together, with the bank extending finance against warehoused commodities and inventories, under collateral management structures of NCMSL.

It is expected to pave the way for significant strides in the banking industry, particularly given the increasing emphasis on risk management in the wake of Basel II norms coming into force very shortly, the release said.

NCMSL, promoted by seven banks including Canara Bank, NCDEX, IFFCO, HAFED and ACE, Geneva, has been set up specifically with the objective of setting up a chain of quality warehouses across the the country to bring about significant changes in the commodity storage sector, and thus facilitate commodity financing in a big way.

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