Mumbai, Mar 29 (PTI) Shortly after launching the general insurance business, the country's largest lender State Bank today entered the custodial services space with SBI Custodial Services, a joint venture with Societe Generale of Frence.
SBI said SBI Custodial Services is the country's first stand-alone custodial services firm that will be servicing both domestic and overseas clients. SBI holds 65 per cent stake in the venture and Societe Generale Securities Services holds the remaining 35 per cent. The company has set a target of around $10 billion in the first year of operations.
The JV has been set up to offer a complete suite of security services to foreign financial institutions as well as domestic institutional investors, the bank said, adding, "the clients will benefit from a single-entry point to the provision of real-time multi-instruments and settlement in multi-currencies."
Custodial services include settlements, clearing, depository participant services, corporate action, cash management and forex services, fund accounting services, performance measurement, registrar and transfer agency services amongst others.
SBI Custodial Services is the fist stand-alone company in the country that would offer a comprehensive array of custodial and fund accounting services to both foreign and domestic investors, an SBI official said. Normally banks offer such services as part of their service offering but not in a stand-alone manner. Stock Holding Corporation is the only other fulfledged firm in this domain in the country today but serves only domestic clients.
The company aims to offer global custody services to eligible domestic clients by providing world-class services to major players in the domestic securities industry, it said.
Announcing the launch of the custodial services, SBI said the company will also offer fund accounting and fund administration services to institutional investors in both domestic and overseas markets.
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Last week, SBI entered the general insurance business with SBI General Insurance in association with Australian firm Insurance Australia Group. SBI holds a majority 74 stake in the JV with the rest being with the Australain company.
The insurance entity, which would initially offer two-three products in commercial segments, plans to start full-scale operations by the second quarter of next fiscal.
State Bank, together with its six associates--State Banks of Indore, Mysore, Bikaner and Jaipur, Patiala, Travancore, and Hyderabad--has total assets of over Rs 13,04,825 crore as of last fiscal and posted a net profit of Rs 11,043 crore.
On a stand-alone basis, as last fiscal, SBI had assets of Rs 9,64,432 crore and deposits of Rs 7,42,073 crore and posted a net profit of Rs 9,121 crore. As of end January, the State Bank Group has a combined branch strength of over 17,600 while the total number of ATMs, as on date, stands at just above 20,000.