HDFC Bank to beef up foreign operations

HDFC Bank is planning to expand its overseas operations in south-east Asia, Europe and the US. At present, the bank has a representative office in Dubai.

The bank continues to explore business opportunities overseas through local bank alliances and alternative channels rather than open a full fledged branch in line with the bank's strategy, said Neeraj Swaroop, retail banking, country head, HDFC Bank. Despite its overseas plans, the bank is keen to focus on India given its huge retail market potential, he added.

The internet-based remittance service, which was launched in July 2004, is growing at 40-50 per cent per month, said Swaroop. Eighty per cent of NRI customer transactions are processed through the net, he added. The bank has a tie-up with Arab National Bank in the UAE, International Bank of Qatar, Bahraini Saudi Bank and multiple exchange houses.

NRI deposits account for more than 10 per cent of the bank's total deposits. On an incremental basis NRI business contributes around 5 per cent to the banks bottom line, Swaroop said.

Maintaining income levels from the NRI business will be a challenge on account of the introduction of the tax regime. Thus, the bank is realigning its strategy to ensure alternative services for deployment of NRI funds such as mutual funds, insurance products and other advisory services, he added.

Recently, the bank in association with Travellex launched doorstep delivery of foreign exchange service in Delhi. It plans to roll out this service in other metros shortly. The bank is set to launch a dollar and euro-denominated travel card (Forex Plus Card) to cater to corporates, tourists and students.