The Hindu Business Line : StanChart NBFC to have corporate focus

Mr A. Christopher M. Low, Chief Executive Officer- India Region, Standard Chartered Bank (right), with Mr M.A Ravi Kumar, Regional Head, Global Markets-India & Nepal Wholesale Banking, at a press conference in Mumbai on Wednesday. - - Shashi Ashiwal

Mumbai , March 10

THE newly set up, Standard Chartered Investments and Loans (India) Ltd (SCILL), will make the group's maiden venture into the domestic debt market shortly. Standard Chartered Bank today announced the establishment of SCILL, a 100 per cent subsidiary.

Currently the company is being rated by CRISIL. Following the rating, it will float short-term debt instruments in the Indian debt market. SCILL will be a corporate-focused, non-banking finance company, which will not accept public deposits.

"We have set up the NBFC since that will increase our liquidity, we plan to raise commercial papers, non-convertible debentures and inter-corporate deposits in the local debt market," said Mr Chris Low, CEO, India Region, Standard Chartered Bank, at a press conference held here.

The foreign bank has chosen this route to access the domestic capital markets.

Converting its branch in India into a subsidiary would also facilitate the same. However, the bank feels that a subsidiary comes with a lot of disadvantages.

SCILL will start with an equity capital of $7.5 million, which will be scaled up to $50 million over 18 months.

The new entity hopes to build up a Rs 1,100-crore balance sheet in a year's time by disbursing funds to top corporates in India.

The NBFC's corporate clientele would be similar to that of the bank's client list, said Mr M.A. Ravikumar, Regional Head, Global Markets, Standard Chartered Bank.

For the Standard Chartered group, India is the third largest market in Asia after Hong Kong and Singapore. For the year ended December 2003, the Indian unit earned $186 million profit before tax.

Apart from SCILL, Standard Chartered also has another NBFC called Standard Chartered Finance, which looks after the wealth management business.