RSS Feed
Twitter
8:10 AM
Blogger
The London subsidiary of Union Bank of India is expected to be operational by March next year.
The wholly owned subsidiary of Union Bank of India, UBI UK Ltd, has already received the Reserve Bank of India’s approval and was waiting for the local regulator’s approval, according to Mr D. Sarkar, Chairman and Managing Director.
“We have registered the company. The local authority is conducting its due diligence and is going through our risk management and credit management policies. We are hopeful of receiving their approval soon and we hope to commence operations by March 2013,” he told Business Line. The bank currently has a representative office in London. While banks usually prefer upgrading their representative offices into full-fledged branches, the regulatory authority in London prefers the subsidiary channel over the branch route, he said.
“They (local monetary authority) prefer the subsidiary channel as the capital requirement is higher. Branches, they feel, can shut shops anytime, however, subsidiary companies might not do so because of the huge capital involved,” Mr Sarkar pointed out.
The bank might have to pump in $200 million (approximately Rs 1,140 crore at the current exchange rate) in phases. “The total capital requirement is close to $200 million but we can pump that in 2-3 phases as and when the business starts growing,” he said. Apart from the capital, the bank will also have to induct a local board in the company.
Union Bank has one branch in Hong Kong at present. The branch registered a total business of $2.04 billion (Rs 10,388 crore as of March). As on March 31, the deposits of the branch stood at Rs 1,207 crore (Rs 570 crore) and advances stood at Rs 9,181 crore (Rs 5,941 crore).
The branch recorded a net profit of Rs 102 crore for the year ended March 31, as against Rs 50 crore in the previous financial year.
The bank also has five representative offices in Beijing and Shanghai, Sydney, Abu Dhabi and London.
Union Bank also plans to open a branch in DIFC, Dubai, for providing offshore banking facilities to its customers. The bank is also mulling setting up a branch in Belgium.
shobha@thehindu.co.in
The wholly owned subsidiary of Union Bank of India, UBI UK Ltd, has already received the Reserve Bank of India’s approval and was waiting for the local regulator’s approval, according to Mr D. Sarkar, Chairman and Managing Director.
“We have registered the company. The local authority is conducting its due diligence and is going through our risk management and credit management policies. We are hopeful of receiving their approval soon and we hope to commence operations by March 2013,” he told Business Line. The bank currently has a representative office in London. While banks usually prefer upgrading their representative offices into full-fledged branches, the regulatory authority in London prefers the subsidiary channel over the branch route, he said.
“They (local monetary authority) prefer the subsidiary channel as the capital requirement is higher. Branches, they feel, can shut shops anytime, however, subsidiary companies might not do so because of the huge capital involved,” Mr Sarkar pointed out.
The bank might have to pump in $200 million (approximately Rs 1,140 crore at the current exchange rate) in phases. “The total capital requirement is close to $200 million but we can pump that in 2-3 phases as and when the business starts growing,” he said. Apart from the capital, the bank will also have to induct a local board in the company.
Union Bank has one branch in Hong Kong at present. The branch registered a total business of $2.04 billion (Rs 10,388 crore as of March). As on March 31, the deposits of the branch stood at Rs 1,207 crore (Rs 570 crore) and advances stood at Rs 9,181 crore (Rs 5,941 crore).
The branch recorded a net profit of Rs 102 crore for the year ended March 31, as against Rs 50 crore in the previous financial year.
The bank also has five representative offices in Beijing and Shanghai, Sydney, Abu Dhabi and London.
Union Bank also plans to open a branch in DIFC, Dubai, for providing offshore banking facilities to its customers. The bank is also mulling setting up a branch in Belgium.
shobha@thehindu.co.in
0 comments:
Post a Comment