State Bank of India opens branch here
By Kim Jae-won
B. Sriram, managing director at the State Bank of India (SBI), greets journalists during a press conference at the Millennium Hilton Hotel in downtown Seoul, Wednesday, when the lender launched its Seoul branch, focusing on trade finance. / Courtesy of SBI
The State Bank of India (SBI) said Wednesday that it had opened a branch in Korea, seeking business opportunities amid increasing trade volume between the two countries.
SBI said that its Seoul office will focus on trade finance services for Korean companies working in India and Indian corporations doing business here. The bank will also provide remittance services to its home country mainly for Indian and Nepalese workers in Korea.
“We are looking at trade finance, and issuing letters of credit and bank guarantees for Indian companies. We will also provide loan syndication and project financing for Korean companies investing in India,” said Navin Manchanda, CEO of SBI’s Seoul branch, in a press conference.
About 10 Indian companies are doing business in Korea, including the world’s leading rolled aluminum producer Novelis and automaker Mahindra and Mahindra, which owns Ssangyong Motor. Some 600 Korean companies, including Samsung Electronics, Hyundai Motor and POSCO, are active in the Indian market, according to data from the Korea Trade-Investment Promotion Agency.
The launch came amid increasing business ties. Trade volume between Korea and India rose 8.7 percent to $18.1 billion from April 2014 to March 2015, according to data from the Indian government.
B. Sriram, managing director at SBI, expects that its Seoul branch’s business will grow by double-digit percentages every year because he is “very optimistic” about cooperation between Korea and India.
“We are very optimistic of business opportunities between Korea and India. We are hopeful that this branch will grow by double digits,” said Sriram.
Manchanda said that the Seoul branch will start with capital of $10 million which it plans to increase to $50 million by the end of this year. He said that it aims to break even this year, and will expand its presence step by step.
SBI is the second Indian bank entering the Korean market, following the Indian Overseas Bank. SBI has total assets of $327.6 billion. The Indian government is the major shareholder, owning a 58.6 percent stake.
The Mumbai-based lender is flagship banking affiliate of SBI Group which consists of 30 subsidiaries. The group provides a wide range of services such as investment banking, life insurance, credit cards, pension funds, mutual funds and securities trading.