The booming consumer finance space and the growing opportunities in corporate finance is forcing foreign banks to set shop in India. The Australian banks have a particular interest in India on the back of the growing trade relations between the two countries and corporate flows.
After Macquire, the newest entrant is the Australian-based Westpac Institutional Bank. Westpac has opened a representative office in Mumbai after getting a license within three months. The bank has an alliance with Standard Chartered Bank (SCB), India.
"We have an alliance with Standard Chartered Bank for a year now. This alliance has helped SCB to serve the needs of Westpac's clients in India. Similarly, Westpac takes care of the requirements of SCB's clients in Australia and New Zealand,'' said Philip Chronican, chief executive officer, Westpac Institutional Bank.
The SCB-Westpac alliance had helped the Tatas and Wipro to set up offices in Australia, providing them account management and cash management services. SCB had enabled Rio Tinto, the largest precious metals miners in the world to set shop in India.
"India is of prime interest to Westpac considering the rapid growth in trade relations between the two countries. As on March, 2007 the trade flows between the countries stood at around $4 billion. Currently, we manage around 10 per cent of the flows. In the medium term, we want to increase this to 33 per cent,'' added Chronican.
"We see business potential in trade finance and in particular, areas such as commodities, energy, services to the immigrant population and facilitating cross-border corporate flows and investments. We would look at upgrading the representative office to a branch at a later date when the market and regulations relax in 2009,'' added Chronican.
"Westpac believes in organic growth. However, we have acquired banks in Australia and New Zealand. We believe that organic growth enables the managements to have greater control,'' said Yogan Rasanayakam, general manager, Asia, Westpac.
"We will continue with the SCB-Westpac alliance even when Westpac upgrades the representative office to a branch. In the future, this alliance should generate good fee income for the bank,'' said Inderjit Camotra, director, wholesale banking Australia desk, Standard Chartered Bank.
The bank has appointed Vikram Nimkar, former Deutsche Bank executive as the director, Mumbai representative office. The organisation will have a lean team of four employees.