Nearly 30 per cent of the bank's NRI business coming from the UAE

Consolidation to create 12 major lenders in India
DUBAI, February, 09, 2008
Khaleej Times
ISSAC JOHN

The impending consolidation in the Indian banking sector, which will speed up mergers and acquisitions among India's private and public sector banks, would result in the creation of 10 to 12 major lenders by 2011.

A.K. Basu, general manager (international banking) of State Bank of Travancore (SBT), an associate of State Bank of India (SBI), India's largest bank, said currently, there are some 27 public sector banks in India. "Several banks are bracing for the challenges in the post liberalisation era when India opens up for foreign banks in 2009."

Basu, who was in Dubai to finalise the opening of SBT's representative office, said through consolidation, SBI and its seven associate banks expect to emerge as one of the top 10 global banking giants by 2012.

He said plans to open its representative office in Dubai in two months are making headway. SBT has received the approval of UAE Central Bank for the representative office. "With nearly 30 per cent of the bank's NRI business coming from the UAE, there is a need for a representative office to maintain real-time rapport with NRI clientele at their place of stay and work."

He said a majority of the bank's customers are from the low and middle-income category. Setting up the office nearer to them would help to provide services like counselling on deposit products, loan facilities, account opening and investment guidance.

SBT, which has 706 branches, including 574 branches in Kerala, currently manages City Exchange in UAE and Global Money Exchange in Oman. Besides it has drawing arrangements with 19 Exchange houses in the Middle East. More than Rs90 billion is remitted to SBT every year through these exchange companies. Basu's Visit coincides with the formal inauguration of the sixth branch of City Exchange at Al Quoz.

SBT has introduced 'Money Trans', a speed remittance arrangement to City Exchange to facilitate instant and direct transfer credit to the all accounts in the Bank. "In addition, SBT is providing this year NEFT facility to City Exchange. With this facility, customers can send direct remittance to about 37000 NEFT enabled branches of 100 banks in India. Bank has now made a provision in its website for the customers to know the payment status of the drafts purchased from any of the exchange companies with whom it is having drawing arrangements."