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StanChart becomes biggest foreign bank in India

BS Banking Bureau in Mumbai

Standard Chartered Bank has become the country's largest foreign bank Rs 29,000-crore (Rs 290 billion) assets following the merger of the erstwhile ANZ Grindlays India operations. The merger took effect on August 31, 2002, following the clearance of the Reserve Bank of India.

Says StanChart's chief executive officer, India Region, Jaspal Bindra: "We will continue our expansion plans. In the next two years we plan to increase our branch network to 100 from 61. We also plan to increase the distribution network of StanChart Finance in areas where we do not have any branches. We will sell some of our assets products through this network."

StanChart Finance is a 100 per cent owned non banking finance arm of the bank. Standard Chartered had acquired Grindlays business in Middle East and South Asia on July 31, 2000. It had acquired ANZ Banking Group's acquisition for $1.3 billion.

Post merger, StanChart is planning to use the Grindlays name for some of its products like that of mutual funds.

Says Bindra, "The Grindlays name could be used in some of some of our products like credit cards. For generic products like credit cards we are using brand names like - Sapnay etc. The Grindlays name can be used in these products. We are already using the name in our mutual fund products."

The Standard Chartered Group now has a combined head count of around 3,400. It has cut the flab drastically through a series of voluntary retirement schemes (VRS) implemented over the last one year. Both the bank had launched two VRS schemes each with 1330 non-managerial staff and 260 management staff accepting the VRS.

"The bulk of the VRS is over. We still have a section of employees -- below 200-- to whom the scheme can be offered. It will be dependent on our talks with the union," said Bindra.

The bank plans to offer some new services or scale its services. We plan to strengthen our corporate advisory. We will offer advise on debt instruments, syndication, project financing and capital restructuring etc. We will also like to tap the non resident Indians and scale up our services. The bank also plans to go aggressive on the small and medium enterprises."

Both the banks had made a combined operating profit of Rs 848 crore (Rs 8.48 billion). StanChart Grindlays had posted a loss of Rs 393 crore (Rs 3.93 billion)for the year ended March 31, 2002.

This was due to a Rs 506.5 crore (Rs 5.065 billion) out-of-court settlement with the National Housing Bank related to the 1992 securities scam.

StanChart, on the other hand, shown a 107 per cent growth in net profit to Rs 384.6 crore (Rs 3.846 billion) as against Rs 185.4 crore (Rs 1.854 billion) in the previous year.

StanChart has already merged the Kolkata branch of Grindlays with itself while the process will be done in Ahmedabad and Kanpur. It had sold three of its Grindlays branches - Srinagar, Shimla and Darjeeling.

The Srinagar branch was sold to Jammu & Kashmir Bank while the latter two was sold to ICICI Bank. The merger has also helped the bank to free up 4,25,000 sq ft of land in the metros such as Mumbai, Delhi, Kolkata, Chennai, etc.

It has also opened a global processing centre in Chennai -- Scope International -- which has a staff strength of around 1900.

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