(MENAFN- The Peninsula) Doha Bank shareholders yesterday unanimously approved the "Scheme of Amalgamation" of Reserve Bank of India, an official formality required to take over the business operations of HSBC Bank Oman in India by Doha Bank, India.
The Extraordinary General Assembly meeting of the shareholders was chaired by Sheikh Fahad bin Mohammad bin Jabor Al Thani, Chairman of Doha Bank.
The India business of HSBC Bank Oman has gross assets of Rs3.41bn (about QR200m) (as on March 31, 2014), with a total deposit of Rs1.17bn (about QR64m). The bank has two branches located in Mumbai and Kochi that serve approximately 2,900 customers. Under the deal, Doha Bank has agreed to pay a single lump sum amount of about Rs1.28bn (about QR75m) to the seller, payable outside India.
With the acquisition of these assets, Doha Bank is set to start operations of a full-fledged branch in India. The group is also inclined to establishing a wholly-owned subsidiary (WOS), a route that India's central bank has been pushing for.
"We had a soft opening in July. Now we are in the process of having an integrated full scale operation with the completion of the technology interface very soon," Dr R Seetharaman, Group CEO of Doha Bank, told this daily on the sidelines of the meeting.
Asked about the time frame for a WOS in India, he said: "That's a long-term plan, which would largely depend on the growth model. We do not have any capacity constrain, if there are opportunities we will scale it up."
He said that the company is set to announce the names of the team of the senior management that will be taking care of the bank's India operations.
Moreover, Doha Bank, one of Qatar's leading lenders, is also open to acquisitions in many other emerging markets and evaluating opportunities, according to the CEO.
Replying to a question on why Doha Bank is expanding overseas at a time when Qatar has become favourite destination of global investors, he said: "Banking business is global in nature. You have to go to a market which is driven by growth. India still is registering a commendable more than five percent growth. Moreover, we are not only in Qatar, our operations are also in Dubai, Abu Dhabi and Kuwait. There are bilateral synergistic opportunities between the India and the Gulf states. The Gulf-India bilateral trade has grown to $170bn. We have 7.2 million Non-resident Indians (NRIs) working in these countries who are remitting money.
"When it comes to banking, there are a lot of Indian companies such as Tatas, Voltas, Shapoorji Pallonji (SP Group) and many other corporate houses operating in these countries, including Qatar. So we intend to facilitate them."
He added: "Similarly, there are many Arab corporations that are also interested to invest in India, and we want to be an intermediary to promote that."
On the bank's India operation, he said that by getting a license the bank will be in a position to add more value to small and mid-sized enterprises. "So this deal is only a tip of the iceberg."
Citing recent IMF estimates, he stressed that India is on the right direction to achieve over 6.5 to seven percent growth next year as it has been able to consolidate financial stability with lower inflation and narrowing current account deficit.
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