Sbi Russia Arm Round The Bend

The State Bank of India (SBI) would soon be opening a subsidiary in Russia as a joint venture with Canara Bank. While SBI will hold 60 per cent in the venture, Canara Bank will hold the balance 40 per cent. The arm is set to start functioning in two months. The groundwork for this is being finalised.

Initial capital for the overseas outfit has been fixed at euro 10 million, but the operation may require more capital therafter to grow, admitted SBI sources.

"Norms for Russia require a minimum capital of euro 10 million and that is the amount we have fixed for now. If necessary we will pump in more funds into the outfit," said SBI chairman Janki Ballabh.

 

This Russian outfit will facilitate bilateral trade between the two nations. Moreover, it will also undertake operations such as bill discounting and other finance requirements of Indian businesses there.

"While there has been a general downturn in trade volumes in the recent years, we expect trade between the two countries to grow in the coming years," he said.

The arm would seek to cash in on the service requirements of the trading community in Russia. "Indications are that bilateral trade between the two countries will attain a large volume in a reasonable period of time and a survey shows that there is substantial demand for trade finance between the two countires," said Ballabh.

The Russian economy is looking up owing to strong oil prices, generating demand for goods and services.