Banks looking to expand overseas

Source :Priya Nair:Mumbai, Sept. 13,2010

Indian banks are increasingly looking to expand overseas in order to balance their portfolios and spread out their risks. Also, the expansion and globalisation of the Indian corporate sector will bring business and volumes to Indian banks, said Mr Deepak Haria, Partner, Deloitte.

In order to assist the Indian financial sector on setting up regulated business within the UK, Deloitte and UK Trade and Investment (UKTI) recently released a guide for India Inc.

Lord James Sassoon, Commercial Secretary to the Treasury, UK, said during a recent banking seminar, that at least 10 Indian banks and financial sector players are considering expanding into the UK.

State Bank of India is looking to increase the number of its branches in the UK to 12 from seven, over the next five months, Mr O. P. Bhatt, Chairman, SBI, said recently.

According to Mr Haria, following the financial crisis, when a lot of banks in the UK were downsized or withdrawn, Indian banks are seen as good and stable banks, particularly the public sector banks.

Apart from the UK and other traditional geographies such as China, Hong Kong, West Asia, a number of Indian banks are also looking to go into Africa, Canada, Brazil, Australia and New Zealand.

Also, in the last few years, the Indian economy has been growing and Indian banks want to follow their customers who are globalising. “Just as India Inc is globalising, the need for banking abroad is increasing and what better than their natural Indian banking partner being present where they go next,'' he said.

Focusing on the huge non-resident Indian community is also helping Indian banks to expand their business.