China Daily - 07.08.2019

BUSINESS

CHINA DAILY Wednesday, August 7, 2019 | 17

By SIVA SANKAR
[email protected]

Amid a wave of closures of various
Indians banks’ China operations,
India’s largest lender said it will not
only stay committed to serving the
mainland market but seek fresh
growth opportunities, to boost both
bilateral trade and the growing Chi-
nese investments in Indian startups.
“The deepening of reforms and
opening-up in China’s financial ser-
vices sector, and the rise of the AIIB
(Asian Infrastructure Investment
Bank) and the NDB (New Develop-
ment Bank) are encouraging signs
in China. Despite slowing economic

SBI bullish on Chinese market

India’s top lender

seeks fresh growth

opportunities to

boost bilateral

trade, investments

growth, China remains a key desti-

nation for foreign banks. Prospects

for bilateral trade growth are bright,

so we are looking at trade finance,”

said Venkat Nageswar, deputy man-

aging director in charge of interna-

tional operations of the State Bank

of India.

SBI, which ranks 57th among the

world’s top 1,000 lenders, will con-

solidate its China operations by

integrating its Tianjin operations

into its Shanghai branch, which will

push its 2020 business target to $

billion from the current $700 mil-

lion, said Swaminathan, CEO of the

bank’s China unit.

SBI’s digitalization drive will ena-

ble various banks in China involved

in bilateral trade to make direct

remittances to India. “We hope to

garner at least 10 percent of the $

billion annual transaction volume,”

Nageswar said. Besides, SBI is also

targeting Chinese utilities such as

China Gas for loan syndication ser-

vices.

India’s annual imports from Chi-

na are valued at $60 billion, and SBI

will focus on trade finance activities

for a business of up to $1 billion.

Toward this end, it is in talks with

the AIIB, the NDB, China’s Exim

Bank and the China Development

Bank to jointly offer project finance

and refinance services. Indian joint

ventures in China as well as Chinese

subsidiaries of Indian companies

are expected to benefit, which in

turn would help cement bilateral

trade ties, he said.

With recent and projected future

GDP growth rates of 7 percent or

above, India continues to shine in

the global economic landscape, with

a “very doable” GDP target of $5 tril-

lion by 2024. This represents a big

opportunity for Chinese overseas

investments, he said.

China’s ICBC operates a $200 mil-

lion startup investment fund in

India, while Bank of China received

Indian regulatory approval for its

retail banking services last week.

Given that Bank of China is expand-

ing its India footprint, SBI, which is

Indian’s pre-eminent “financial con-

glomerate”, will explore potential

joint ventures with Chinese entities,

he said.

Of particular interest would be

dedicated stressed asset funds that

can take over floundering business-

es, turn them around, and make rea-

sonable profits by reselling them to

strategic investors. It is a win-win

situation for all the stakeholders.

This market is currently estimated

at $143 billion, which should inter-

est Chinese investors, including

banks, he said.

SBI is aware of Chinese investors’

tremendous interest in funding

Indian startups. Given the bank’s

and its subsidiaries’ presence

across India’s financial ecosystem

via custodial, brokerage, advisory,

legal and regulatory consulting,

and capital market services, SBI is

the go-to bank for Chinese inves-

tors, he said.

A man walks out of a State Bank of India branch in Kolkata, India.REUTERS
hardest, helping reduce salary
costs by as much as 4 percent.
HSBC made the surprise
announcement as it reported a
15.8 percent rise in pretax profit to
$12.4 billion for the six months to
June 30.
Ronit Ghose, bank analyst at
Citi, told the FT that Tucker and
HSBC’s directors had “clearly lost
confidence in (Flint’s) ability to
navigate the tougher outlook faced
by HSBC given the geopolitical
and macro uncertainties, structur-
al headwinds for global banks, and
digital disruption challenges”.
“In addition, we believe there
were likely differences in style
between the outgoing CEO and
the chairman,” Ghose added.
Reports earlier this year noted
that an HSBC investigation led to
charges against Chinese company
Huawei Technologies’ Chief
Financial Officer Meng Wanzhou,
after the US demanded the bank’s
help. HSBC provided the informa-
tion that allowed the US to apply
for the extradition of Meng.
The request for information
came while HSBC was being moni-
tored by US authorities over sanc-
tions-busting and failing to
prevent money laundering in
Mexico.

By JONATHAN POWELL

in London

[email protected]

The chief executive of HSBC has

stepped down after less than two

years in the job, as the banking

giant revealed solid first half prof-

its but warned it faced “challeng-

ing” geopolitics.

The bank has also said it could

cut nearly 5,000 jobs due to a

weaker outlook, and the departure

of John Flint comes as trade-war

tensions flare between the United

States and China.

Under Flint’s leadership, the

bank has pivoted to Asia, which

accounted for more than half of its

operating income in the second

quarter.

HSBC Chairman Mark Tucker

said talks over Flint’s future had

been “going on for a while” and the

decision was not taken lightly.

“In the increasingly complex

and challenging global environ-

ment in which the bank operates,

the board believes a change is

needed to meet the challenges that

we face and to capture the very sig-

nificant opportunities before us,”

Tucker said. “This is a decision

about the future.”

HSBC said it would look both

internally and externally for a new

leader and that Noel Quinn, head

of the commercial banking divi-

sion, will be interim CEO in the

meantime.

The 51-year-old Flint ran the

bank’s retail and wealth manage-

ment business before taking over

as chief executive last year. At that

time, he was seen as a safe choice

for the top job and was known to

be the favored selection of his pre-

decessor, Stuart Gulliver.

In an interview with the Finan-

cial Times on Monday, Tucker

said: “This had nothing to do with

personalities; this was a unani-

mous decision of the non-execu-

tive directors.”

Tucker denied that Flint was

opposed to new cost cutting plans,

which HSBC revealed on Monday

would result in up to 4,700 job

cuts, or 2 percent of its 237,685-

strong global workforce. The move

is expected to hit senior staff the

HSBC chief executive

John Flint steps down

In the increasingly

complex and

challenging global

environment in

which the bank

operates, the board

believes a change is

needed to meet the

challenges that we

face and to capture

the very significant

opportunities

before us.”

Mark Tucker, chairman of

HSBC

    

   





  

  





       

  



 





 



 

 





 

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