"We want to scale it (the present branch format) up further to subsidiary. Once we have a subsidiary, then we will put up our performance in Tier I and Tier II cities and that is our medium and long-term goals," Doha Bank group chief executive Dr R Seetharaman told media after the Qatari Businessmen Association's (QBA) meeting with Indian Prime Minister Narendra Modi.
The rules (regarding WOS) issued by the Reserve Bank of India (RBI) in November 2013 could expand opportunities for international banks in India since they would have greater freedom to open branches and be able to participate more in the development of the country's financial sector.
Foreign banks operating in India before August 2010 have the option of continuing as branches. "However, they will be incentivised to convert into WOS because of the attractiveness of the near-national treatment afforded to WOS," according to the RBI.
Elaborating on the expansion plan of Doha Bank in India, Seetharaman said in the first phase, Doha Bank would like to have 12 branches (which could take between two to three years) in those Indian cities which are synergistic to its operations.
Highlighting that its preference would be opening more branches predominantly in Gujarat, Tamil Nadu, Karnataka and Andhra, Seetharaman said Doha Bank is yet to take up the matter with the banking regulator RBI.
"We have bigger plans to leverage on the synergistic opportunities between India and Qatar," he said, quoting Doha Bank chairman Sheikh Fahad bin Mohamed Jabor al-Thani, who was also present at the meeting with Modi.
Pointing out that the bank would have to complete a few audits, Seetharaman said Doha Bank’s first branch in India was an organic one and another two were acquired (from HSBC Oman); and further branch expansion would have to go through internal processes and then getting regulatory clearances from Qatar.
Stressing that capital is not a constraint to have a better toehold in fast-growing India, he said the banking sector in the Asian country offered huge opportunities for Doha Bank, which will be a Gulf Cooperation Council (GCC) bank in India to cater to the growing needs of both Indian and Qatari as well as Gulf corporates in view of the rising trade within the two economic blocs.
The overall trade between GCC and India in 2014-15 was worth more than $133bn, he said, adding bilateral trade between Qatar and India was close to $16bn.
Doha Bank, which will soon relocate its Kochi (Kerala) branch to Lulu Mall, is planning to target the growing retail sector because of the huge opportunities, especially in electronic banking.
Foreign banks account for less than 1% of India’s total branch network, about 7% of the total banking sector assets and a sizeable 11% of profits as on March 2013. India's banking system is dominated by state banks, which accounted for more than two-thirds of the sector's assets at the end of March 2012, the latest RBI data showed.