ICICI Bank en route to Russia

ICICI Bank, India's largest private sector bank, is set to enter Russia with a subsidiary.

This is the first time that a new generation private sector bank is foraying into the Russian market to cater to the growing retail and trade finance demand in the country. ICICI Bank is awaiting local regulatory approval for the entry.

Earlier, a State Bank of India-Canara Bank joint venture "" Commercial Bank of India LLC "" was opened in Moscow last month.

Bhargav Dasgupta, senior general manager and head of international banking group, ICICI Bank, said: "Consumer demand and buying pattern in the Russian market is very similar to that of India. The banks sees huge potential for retail and trade finance services in the Russia".

With increasing number of business opportunities, ICICI Bank intends to roll out several branches overseas. In October, it plans to branch in Bahrain, to be followed by branches in Sri Lanka and in the US and later a representative office in South Africa.

HDFC Bank is also set to beef up its foreign operations. Having opened a representative office in Dubai and entering into tie-ups with local banks. HDFC Bank is now exploring tie ups with banks in Kenya, Singapore, Hong Kong, the UK and the US in the next 12 to 18 months.

Neeraj Swaroop, country head, retail banking, HDFC Bank said: "The bank continues to explore business opportunities overseas through local bank alliances and alternative business channels rather than open a full fledged branch which is in line with our strategy."

Other new generation private sector banks like UTI bank and IDBI Bank are also planning to set up operations in Dubai. ICICI Bank's ambitious plan also encompasses catering to the growing Indian clientele who are spreading operations in Russia.

Bankers are of the opinion that the international branches were must to cater to the growing Indian clientele who are mushrooming overseas by either setting up new businesses or acquiring small companies.

While New York, Bahrain and South Africa are a few attractive business centres for a few Indian corporates, several of them are focusing to cater to the European market. Besides even the Russian market is being tapped by a few Indian companies.

Bhargava said, "The bank's overseas expansion strategy is driven by its customer strategy and the possible trade opportunities with the country in which the bank intends to set shop."