Indian banks' overseas workforce expands

However, foreign banks cut jobs in India

At a time when foreign banks operating in India are reducing their employee count here, Indian banks have increased their overseas workforce.

The number of employees working abroad with Indian banks rose 6.1% in financial year 2011-12, according to the Reserve Bank of India's (RBI) survey on international trade in banking services.

The employee count in foreign banks operating in India, however, decreased 2.9% during the financial year.

The survey report, which was released today, covered 163 overseas branches, 158 overseas subsidiaries on Indian banks and 309 branches of foreign banks operating in India.

The overseas subsidiaries of Indian banks registered 11 per cent growth in headcount in 2011-12.

The report said Indian banks operating abroad employed 66.3 per cent of staff from local sources, 30.8 per cent from India and remaining 2.9 per cent from other countries. The share of local employees in total employees was 99.6 per cent for foreign banks in India during the year.

"The profitability ratio, i.e. profit to total assets, of branches of Indian banks operating abroad decreased to 0.7 per cent (from 1.1 per cent) in 2011-12. The profitability ratio of foreign banks operating in India increased to 2.4 per cent (from 2.3 per cent) in 2011-12," the survey report said.

Bahrain, Belgium, Hong Kong, Japan, Singapore, Sri Lanka, UAE, UK and USA were the major countries that accounted together for nearly 91 per cent of the total trade in banking services of the Indian banks' branches.

In 2011-12, foreign banks in India generated total fee income of Rs 9,430 crore while overseas branches of Indian banks earned total fee income of Rs 6,800 crore.

"Indian banks' branches operating abroad generated major share of fee income by rendering credit related services and trade finance related services. Derivative, stock, securities, foreign exchange trading services and financial consultancy and advisory services were the major source of fee income for the foreign banks operating in India," the report said.

Indian banks' overseas branches reported 27 per cent rise in credit and 27.1 per cent increase in deposits during 2011-12. Foreign banks in India registered credit growth of 21.8 per cent while their deposit base expanded by 14.3 per cent during this period.