Financial Daily from THE HINDU group of publications
Tuesday, Sep 03, 2002
Money & Banking
Mergers & Acquisitions
StanChart, Grindlays merger completed
MUMBAI, Sept. 2
STANDARD Chartered Bank today said it formally completed merger with Grindlays, part of the ANZ Banking Group on August 31, forming the largest foreign bank in terms of branch network and profitability in India.
The merged entity has a combined network of 61 branches and 74 ATMs across 15 cities of the country.
"We intend to grow in terms of geography and in terms of product range. The bank plans to expand its network to 100 branches by 2004,'' Mr Jaspal S. Bindra, CEO, India Region, Standard Chartered Bank, told Business Line.
"We plan to enter into Tier II cities and touch 30 cities soon," said Mr Bindra.
Plans are on to open branches in Chandigarh, Ludhiana, Lucknow and Jaipur by the end of this calendar year, said a bank official.
The new bank is to offer corporate advisory services, focus on small and medium enterprises and build its NRI business, said Mr Bindra.
The acquisition process is part of Standard Chartered Bank's acquisition of Grindlays operations in West Asia and South Asia, which started on July 31, 2000.
Total assets of the two entities add up to Rs 29,000 crore and total deposits stand at Rs 15,439 crore, as on March 31, 2002.
For the year ended March 31, 2002, net profit for Standard Chartered Bank stood at Rs 384.6 crore and net loss of Standard Chartered Grindlays Bank stood at Rs 393.2 crore.
The net loss of the Standard Chartered Grindlays Bank is on account of an one-time settlement of Rs 506.5 crore to National Housing Bank, due to the 1992 stock market scam.
The burden of three voluntary retirement schemes resulted in an extraordinary expenditure of Rs 144.3 crore.
The first phase of integration between the two entities involved people integration, followed by systems integration, and thirdly, the liability/deposit transfers.
For overlapping posts in the new entity, employees of both banks gave interviews through the `general selection process' and fresh appointment letters were given to the newly-appointed staff, said a spokesman for the Bank.
The banks had four voluntary retirement schemes in both the entities put together, after which the staff strength of the new entity now stands at 3,300 from 5,500.
The bank now runs on `Hogan', the software technology solution Standard Chartered Bank uses worldwide. The two banks were previously functioning on two different systems.
Standard Chartered & Standard Grindlays, this year, had two separate annual reports to register their results. Next year onwards, a single document will serve the purpose, said a spokesperson.
The bank had sold redundant floor space close to 4,25,000 square feet. Duplicate branches of the entity in Kanpur and Ahmedabad are to be merged shortly since they are in close proximity.
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