India is new focus for Societe Generale

French bank opens branch in Sanand; plans 4 more in the country

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Europe’s economic woes have led French multinational bank Societe Generale to bet big on growing economies such as India. Today, the bank opened a branch in Sanand (about 40 kilometres from here), its third in the country. In the coming years, it plans to open branches in Bangalore, Chennai, Hyderabad and Pune.

Societe Generale has been present in India since 1978, through a representative office in Delhi. In 1985, it opened its first full-fledged branch in Mumbai. In 1993, it opened a branch in Delhi. For its third branch, the bank had zeroed in on Ahmedabad. However, it later chose Sanand, as Reserve Bank of India (RBI) guidelines mandate banks to open branches in the hinterland as well.

Marc Emmanuel Vives, chief executive and group chief country officer, Societe Generale India, said, “For the last two decades, we have been focusing on our home market, Europe. Now, we have decided to focus on Asian economies, especially India. While India can be a complex market, we feel we can have a better match with Indian organisations and entrepreneurs, compared to those in China.” The bank hopes its India operations catch up with its operations in China, in terms of size of business, in three years.

Vives didn’t rule out the possibility of entering India’s retail banking segment. However, he said the bank hadn’t set a time frame for this.

The bank’s Sanand branch would be a corporate banking unit and have five employees. “Gujarat has been chosen as our first step for expanding our presence beyond Mumbai and New Delhi because it is a very dynamic and diversified market, with industrial growth among the best in India. The market is flourishing, with numerous companies foraying into various industries such as chemicals, pharmaceuticals, automobiles and engineering. Gujarat is a forward-looking state with enormous support from the state government to attract new investments,” Vives said.

On India’s growth prospects, he said, “While we are not over-optimistic, we are positive about the Indian economy. We expect it to grow 5-5.5 per cent this year. The economy has the potential to grow between seven and nine per cent, provided certain bottlenecks are addressed. Such a growth rate is very attractive for any European entity.”

The bank’s overall lending in India so far stands at about Rs 2,120 crore. Last year, it recorded 50 per cent growth compared to 2011. It expects to sustain this growth for three years.

In India, Societe Generale provides a wide range of banking facilities---from customer deposits and working capital loans to sophisticated investment banking products such as structured finance, derivatives, etc. Other services include correspondent banking, offshore energy hedging and commodity derivatives.
 

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