Financial Daily from THE HINDU group of publications
Friday, Mar 11, 2005
Financial Daily from THE HINDU group of publications Friday, Mar 11, 2005 |
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Money & Banking
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Foreign Banks HSBC to infuse $180 m in India Our Bureau
Mr Niall S.K. Booker, Group General Manager & CEO, HSBC India (right), with Mr Anurag Adlakha, Area-Financial Controller, addressing a press conference in Mumbai on Thursday. — Shashi Ashiwal
Mumbai , March 10 THE Hongkong and Shanghai Banking Corporation (HSBC) on Thursday said it will infuse $180 million (around Rs 792 crore) in additional capital before this month-end to expand its Indian operations. Mr Niall S.K. Booker, Group General Manager and CEO of HSBC India, told media persons that the fresh capital would increase the capital adequacy ratio of HSBC India to 13.5 per cent from 10 per cent. Additional capital will include $150 million, to be brought in by HSBC, and $30 million to be retained from the profits generated by the Indian operations in the last fiscal. An additional $63 million will also be infused before June from the profits made by the Indian operations in the current fiscal. This will take the total capital invested in India, in 2005 alone, to $243 million, Mr Booker said. This is the second tranche of funds HSBC has infused in the last two years. In March 2003, the bank injected $150 million into its Indian operations. "The fresh funds will be used to support the growth of HSBC's fast growing retail banking and commercial banking operations in India," Mr Booker said. Mr Booker said that the Indian operations grew 35 per cent in the calendar 2004, of which retail operations contributed around 42 per cent. The home loan portfolio saw an increase of around 85 per cent, which amounts to around Rs 3,200 crore in absolute terms. The Indian operations now have an asset size of $6 billion, said Mr Anurag Adlakha, Area Financial Controller, India. The fresh capital investment by HSBC is a proof of the fact that bank has identified India, Brazil, Mexico and China as markets for organic growth, said Mr Booker. The bank opened its 40th branch in Nagpur and has also got licences to open branches in Delhi and Indore, he said. HSBC is also considering setting up a 100 per cent non-banking finance company to expand its retail growth, Mr Booker said. He said HSBC had been considering it for some time and the NBFC would be one way to widen the bank's distribution channel. The NBFC would look specifically at what kind of customer base can be serviced and what products can be offered, in order to take advantage of the expanding middle class in India.
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