Focus on large companies suits us better: Jaideep Khanna

Interview with MD, Corporate & Investment Banking, Barclays India

In 2011, suspended expansion of its retail banking operations, exited the and small and medium enterprises businesses, and merged its corporate and investment banking teams in India. The merged charge is headed by Jaideep Khanna, who tells Somasroy Chakraborty the Britain-based lender has no plan to leave the country. Edited excerpts:

You have closed your retail and SME banking businesses. Are you looking to exit India?
The market environment made sense for us to merge the corporate and investment banking businesses. We decided to move away from the SME coverage function and refocused our attention on larger corporates. Foreign banks in India have a limited number of branches. The key success factor in retail and SME businesses is having the ability to be near your clients. Hence, the strategy to focus only on large companies is more suited to our skill sets and the number of branches. We will target companies that are market leaders in their segments, either have overseas operations or the ambition to become global corporations. India has strategic significance for our group. So, we are committed to staying invested in India and it continues to be an area of investment and focus for us.

If you will focus on large companies only, will you be keen to set up a subsidiary here?
We are committed to do what the regulator wants us to do. So, if subsidiarisation is something the central bank feels is good for foreign banks in the country, we will comply. We will continue to operate in this country, either through a subsidiary or a branch. But the guidelines are not clear on some of the issues, like taxation and branch presence. Once these are clarified, we will have better understanding of the benefits and detriments of subsidiarisation.

What are your plans to expand the corporate and investment banking businesses?
The integration is done. Last year, we had launched our equities business. While it is still very early days, we are encouraged by the growth prospects. It was the only segment where we were not present. We already have a strong debt market business. In terms of hiring, we will continue to recruit for our equities business. But we look for quality rather than quantity. Currently, we have 302 employees in the corporate and investment banking business, of which 72 are in coverage and products. We feel we now have, overall, the right manpower size.

You have nine bank branches in India. Will you apply for more licences?
For our strategy, we have the right number of branches. Hence, we don’t have any immediate plans to apply for fresh licences. If we change our strategy, we may either increase or decrease the number of branches.

How do you see the markets? Is India losing its attractiveness among foreign investors because of governance-related issues and policy paralysis?
The markets have been very slow in recent months. We have ongoing dialogues with our clients but I don’t see too many transactions happening. Clearly, the sentiment is a function of the underlying demand, the demography and the regulatory framework. While the demand continues to remain strong, I think if the government takes more steps to provide clarity on the regulatory and legal framework, it will encourage market participants in making investments. Everybody is awaiting clarity and understanding on tax and other regulatory provisions.

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Business Standard
177 22
Business Standard

Focus on large companies suits us better: Jaideep Khanna

Interview with MD, Corporate & Investment Banking, Barclays India

Somasroy Chakraborty  |  Mumbai 



In 2011, suspended expansion of its retail banking operations, exited the and small and medium enterprises businesses, and merged its corporate and investment banking teams in India. The merged charge is headed by Jaideep Khanna, who tells Somasroy Chakraborty the Britain-based lender has no plan to leave the country. Edited excerpts:

You have closed your retail and SME banking businesses. Are you looking to exit India?
The market environment made sense for us to merge the corporate and investment banking businesses. We decided to move away from the SME coverage function and refocused our attention on larger corporates. Foreign banks in India have a limited number of branches. The key success factor in retail and SME businesses is having the ability to be near your clients. Hence, the strategy to focus only on large companies is more suited to our skill sets and the number of branches. We will target companies that are market leaders in their segments, either have overseas operations or the ambition to become global corporations. India has strategic significance for our group. So, we are committed to staying invested in India and it continues to be an area of investment and focus for us.

If you will focus on large companies only, will you be keen to set up a subsidiary here?
We are committed to do what the regulator wants us to do. So, if subsidiarisation is something the central bank feels is good for foreign banks in the country, we will comply. We will continue to operate in this country, either through a subsidiary or a branch. But the guidelines are not clear on some of the issues, like taxation and branch presence. Once these are clarified, we will have better understanding of the benefits and detriments of subsidiarisation.

What are your plans to expand the corporate and investment banking businesses?


The integration is done. Last year, we had launched our equities business. While it is still very early days, we are encouraged by the growth prospects. It was the only segment where we were not present. We already have a strong debt market business. In terms of hiring, we will continue to recruit for our equities business. But we look for quality rather than quantity. Currently, we have 302 employees in the corporate and investment banking business, of which 72 are in coverage and products. We feel we now have, overall, the right manpower size.

You have nine bank branches in India. Will you apply for more licences?
For our strategy, we have the right number of branches. Hence, we don’t have any immediate plans to apply for fresh licences. If we change our strategy, we may either increase or decrease the number of branches.

How do you see the markets? Is India losing its attractiveness among foreign investors because of governance-related issues and policy paralysis?
The markets have been very slow in recent months. We have ongoing dialogues with our clients but I don’t see too many transactions happening. Clearly, the sentiment is a function of the underlying demand, the demography and the regulatory framework. While the demand continues to remain strong, I think if the government takes more steps to provide clarity on the regulatory and legal framework, it will encourage market participants in making investments. Everybody is awaiting clarity and understanding on tax and other regulatory provisions.

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Focus on large companies suits us better: Jaideep Khanna

Interview with MD, Corporate & Investment Banking, Barclays India

In 2011, Barclays Bank suspended expansion of its retail banking operations, exited the credit cards and small and medium enterprises businesses, and merged its corporate and investment banking teams in India. The merged charge is headed by Jaideep Khanna, who tells Somasroy Chakraborty the Britain-based lender has no plan to leave the country.

In 2011, suspended expansion of its retail banking operations, exited the and small and medium enterprises businesses, and merged its corporate and investment banking teams in India. The merged charge is headed by Jaideep Khanna, who tells Somasroy Chakraborty the Britain-based lender has no plan to leave the country. Edited excerpts:

You have closed your retail and SME banking businesses. Are you looking to exit India?
The market environment made sense for us to merge the corporate and investment banking businesses. We decided to move away from the SME coverage function and refocused our attention on larger corporates. Foreign banks in India have a limited number of branches. The key success factor in retail and SME businesses is having the ability to be near your clients. Hence, the strategy to focus only on large companies is more suited to our skill sets and the number of branches. We will target companies that are market leaders in their segments, either have overseas operations or the ambition to become global corporations. India has strategic significance for our group. So, we are committed to staying invested in India and it continues to be an area of investment and focus for us.

If you will focus on large companies only, will you be keen to set up a subsidiary here?
We are committed to do what the regulator wants us to do. So, if subsidiarisation is something the central bank feels is good for foreign banks in the country, we will comply. We will continue to operate in this country, either through a subsidiary or a branch. But the guidelines are not clear on some of the issues, like taxation and branch presence. Once these are clarified, we will have better understanding of the benefits and detriments of subsidiarisation.

What are your plans to expand the corporate and investment banking businesses?
The integration is done. Last year, we had launched our equities business. While it is still very early days, we are encouraged by the growth prospects. It was the only segment where we were not present. We already have a strong debt market business. In terms of hiring, we will continue to recruit for our equities business. But we look for quality rather than quantity. Currently, we have 302 employees in the corporate and investment banking business, of which 72 are in coverage and products. We feel we now have, overall, the right manpower size.

You have nine bank branches in India. Will you apply for more licences?
For our strategy, we have the right number of branches. Hence, we don’t have any immediate plans to apply for fresh licences. If we change our strategy, we may either increase or decrease the number of branches.

How do you see the markets? Is India losing its attractiveness among foreign investors because of governance-related issues and policy paralysis?
The markets have been very slow in recent months. We have ongoing dialogues with our clients but I don’t see too many transactions happening. Clearly, the sentiment is a function of the underlying demand, the demography and the regulatory framework. While the demand continues to remain strong, I think if the government takes more steps to provide clarity on the regulatory and legal framework, it will encourage market participants in making investments. Everybody is awaiting clarity and understanding on tax and other regulatory provisions.

image
Business Standard
177 22

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