UBI in talks with 3-4 Indonesian banks for acquisition

The government-owned Union Bank of India (UBI) has initiated preliminary discussions with 3-4 small-sized Indonesian banks for possible acquisition, a top official said.

"We are talking to 3-4 small banks in Indonesia for potential acquisitions. Talks are at very preliminary level and nothing has been finalised so far," the official told PTI here.

Union Bank's board has already approved a strategy for its overseas expansion, which includes acquisitions in geographies like Indonesia, Africa, Europe and UK, the official said.

Once the bank identifies a target, the lender will have to seek regulatory approvals from the Reserve Bank of India and the Indonesian banking regulator to go ahead with the proposal, the official said.

"Through the acquisition of a local bank, we aim to assist Indian entities operating in that region, facilitate trade financing and offer retail banking services to local clients," the official said.

At present, Union Bank's overseas presence is limited in Hong Kong, where it has a full-fledged branch. Besides, it has four representative offices abroad.

The representative offices are in Shanghai, Beijing, Abu Dhabi and Sydney.

Another state-run lender, IDBI Bank had yesterday said it was talking to a private sector bank for a possible acquisition and has completed due diligence.

Major banks that have a presence in foreign countries include the State Bank of India, Bank of Baroda and ICICI Bank.