India’s largest lender started operations of its first branch in Korea on Wednesday, as trade between the two Asian economies flourishes.
B. Sriram, managing director of State Bank of India, speaks during a press conference in Seoul on Wednesday.
“SBI Seoul branch will supplement existing channels of financial intermediation between India and Korea, partnering growth in bilateral trade between the two countries and also the flow of investments from one to the other,” B. Sriram, managing director of the State Bank of India, said during a press conference in Seoul.
The new branch, located in Gwanghwamun in central Seoul, will offer a range of services to corporations conducting business in India and Korea in trade finance, bilateral and syndicated loans and corporate deposits.
Several Indian-owned companies including Novelis, Mahinddra Satyam, Mahindra and Mahindra, Air India and Wipro operate in Korea, while 443 Korean companies have entered the South Asian country, the bank noted.
According to the state-owned bank, it will also reach out to individual customers through offerings of savings and current account facilities, term deposits and remittances services for Indians living in Korea.
The launch comes as trade and economic relations between India and Korea have gathered momentum in recent years since the signing of a free trade deal, known as a comprehensive economic partnership agreement, in 2009.
The two countries’ bilateral trade has reached $18.13 billion, with trade growing by 8.71 percent in 2015 from a year earlier.
“We expect that trade volume between the two will grow much faster than before, as the visit of our prime minister Narendra Modi last year had further encouraged cooperation in defense equipment and technology, shipbuilding, electronics, information technology and infrastructure,” he said. The Indian government is the largest shareholder of the bank with a 58.6 percent stake.
The Mumbai-based bank is aggressively pursuing overseas expansion. The Seoul branch is the SBI’s 194th office in its 36th country, as well as its seventh branch in Northeast Asia, following openings in Japan, China and Hong Kong.
The bank’s overseas assets accounted for 19.82 percent of its $432 billion worth of outstanding assets as of September 2015.
“Our extensive experience in supporting Indian corporates in their foreign endeavors and global corporates in their expansion into India, as well as in other markets, shall be the primary value proposition for our business relationships in Korea,” the managing director said.
In the long term, the bank hopes to enter the Korean retail financial market and introduce a wide range of services of its affiliated firms, which includes investment banking, life insurance, credit cards and pension funds.
“For the time being, we will focus on providing short-term trade finance and corporate finance, as we are just in the beginning stage with eight employees in the branch,” he added.
By Park Han-na (
hnpark@heraldcorp.com)
