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Our Bureau

Mumbai, March 25 In a measure of reciprocity, the banking regulators of both India and Singapore have allowed the leading bank in each others country to open more branches.

The Monetary Authority of Singapore has granted Qualifying Full Bank (QFB) privileges to State Bank of India (SBI) while the Reserve Bank of India granted DBS Bank of Singapore licences to open eight more branches in India.

The QFB will enable SBI to open up to 25 branches including ATMs and offer full range of financial services in Singapore.

As of now, SBI has only one branch in Singapore.

With this, SBI will be the first Indian bank to get this privilege in Singapore, the bank said in a late evening statement on Tuesday.

DBS said that it has received Reserve Bank of India permission to open eight more branches in India. The bank already has two branches in the country.

The reciprocal permission follows signing of the Comprehensive Economic Cooperative agreement between India and Singapore. Under CECA, the two countries had agreed to open up the financial sector.

SBI is expected to open at least three branches in the coming quarter, said a senior official who would not like to be quoted. The bank will now be able to raise deposits and offer wide range of services in Singapore, he said.

The permission to expand its operation in Singapore will help SBI to boost its international revenue, which now accounts for about 10 per cent of its topline.

Recently the SBI Chairman, Mr O.P. Bhatt, said that the bank’s global business is growing at a greater pace than its domestic business. The bank is hoping to double its share in the total business over the next ten years.

Shares of SBI closed at Rs 1,740, on the BSE, on Tuesday, up 5.75 per cent from the previous close of Rs 1,645.65.

According to DBS, the eight additional branches in India will be opened in Bangalore, Chennai, Salem, Kolkata, Moradabad, Nasik, Pune and Surat. DBS already has two branches in New Delhi and Mumbai.

Mr Pranam Wahi, Chief Executive Officer, DBS in India, said the bank plans to open all the eight branches in the next two quarters. The bank has enough capital to meet the expansion requirements, he said.

DBS currently has about 250 employees in India; this will be increased at least by 50 per cent soon, said Mr Wahi.

India is a key market for DBS Bank and this expansion is in line with its commitment to strengthen its Asia franchise in high growth market, he said.

“Our immediate focus will be to scale up our existing business, which includes wholesale banking, lending to SMEs and other corporates, treasury services and M&A services.”

“We will be pursuing a strategy of organic growth in India, but will look for other opportunities as we grow further,” Mr Wahi said.

The bank has a financial services joint venture with Murugappa group-Cholamandalam Finance.

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