StanChart bets on wholesale banking

Standard Chartered Bank is betting big on India on the back of Indian corporates expanding overseas and acquiring assets globally.

It expects rapid growth in its wholesale banking business in the coming years and is targeting a revenue of $ 325 million during the calendar year from the segment.

"The annual revenue (wholesale banking) could be probably in the region of $325 million in 2006, with the expected year-on-year growth of 25-30 per cent for the next 3-5 years," StanChart country head (wholesale banking) Bala Swaminathan told reporters here.

Last year revenues from this segment stood at $ 240 million and StanChart hopes to grow this to $1 billion by 2011.

The bank is also looking at expanding through organic and inorganic means, although there are no immediate plans to do so, StanChart Global CEO (wholesale banking) A. Michael G. Rees said.

"India is the third largest market among our franchises and we are looking at opportunities to expand. Consolidation is a worldwide phenomenon. I do not see India being anything different. But we are constrained by regulations at the moment", he said.

Current rules do not permit foreign banks to own more than 5 per cent in Indian banks. He added that the bank was waiting for 2010, when the sector will be opened up.

Rees added the bank had brought in nearly $2 billion of FDI into India over the last couple of years. On the issue of StanChart's non banking finance company, which is a subsidiary of StanChart Plc, Rees said all options were being looked at.

Bank officials added that the RBI had not expressed any concerns to them over this. The bank is also launching equity-linked and credit-linked notes for Indian corporates, who are likely to spend an estimated $ 150-200 billion by way of capital expenditure.