 "New norms for foreign players not to hit Indian banks: Union Bank")
Opening up of Indian banking industry for foreign players will not harm local lenders, who have been operating in the country for nearly 100 years, asserts a senior executive of Union Bank.
"The presence of more players does not mean we will be weaker. We are ahead of them in terms of local experience and customer relationship," said K Subrahmanyam, executive director of the bank at a press meet here.He was in the city to donate Rs 1 crore to the Chief Minister's relief fund to help the victims of cyclone Phailin and floods in Odisha.
The new banking entrants will ensure more competition in the market and ultimately, will provide benefit to the consumers, he explained."The competition will pave way for introduction of more financial products at competitive prices. At the end, it is the consumer who will benefit," said Subrahmanyam.
The final guideline allow foreign banks to buy local private sector banks subject to the overall investment limit of 74 percent. RBI says these acquisitions will be permitted after a review of the extent of penetration of foreign investment in Indian banks and functioning of foreign banks.
Regarding raising interest rates, the bank said, it has no plans to follow the steps of State Bank of India and HDFC Bank, who recently raised their base rates by 20 basis point.
"We have no plans to hike the rates as of now. But if the cost of resources goes up, then there is a possibility of raising it," said the Union Bank official citing that further tightening of policy rates by the RBI would fuel rate hike.
"The presence of more players does not mean we will be weaker. We are ahead of them in terms of local experience and customer relationship," said K Subrahmanyam, executive director of the bank at a press meet here.He was in the city to donate Rs 1 crore to the Chief Minister's relief fund to help the victims of cyclone Phailin and floods in Odisha.
The new banking entrants will ensure more competition in the market and ultimately, will provide benefit to the consumers, he explained."The competition will pave way for introduction of more financial products at competitive prices. At the end, it is the consumer who will benefit," said Subrahmanyam.
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The Reserve Bank of India (RBI) recently came up with guidelines that allows foreign players to set up their wholly-owned subsidiary banks in India. The new framework requires foreign banks to create separate legal entities, having their own capital base and local board of directors.
The final guideline allow foreign banks to buy local private sector banks subject to the overall investment limit of 74 percent. RBI says these acquisitions will be permitted after a review of the extent of penetration of foreign investment in Indian banks and functioning of foreign banks.
Regarding raising interest rates, the bank said, it has no plans to follow the steps of State Bank of India and HDFC Bank, who recently raised their base rates by 20 basis point.
"We have no plans to hike the rates as of now. But if the cost of resources goes up, then there is a possibility of raising it," said the Union Bank official citing that further tightening of policy rates by the RBI would fuel rate hike.