China bank major sees India as key market

Industrial and Commercial Bank of China (ICBC), which listed in October after the world's largest initial public offering to raise $19.07 billion, sees India as a key potential market. Zhan Xiangyang, director general of the world's third largest bank, with a market capitalisation of $183.85 billion, spoke to Business Standard on Wednesday.

What brings you to India? What is your interest in India as a bank?

We are here as a part of the Chinese delegation on banking and financial sector to explore the prospects for fostering bilateral relations. For ICBC, this is what we as a bank are interested in. As the two economies have a lot of commonalities and the economic exchange goes on, many entities in China are coming to India. We will follow our customers.

Would you look to establish your presence in India?

We now regard India as our key potential market. We are conducting early stage research on India. When a bank comes to a foreign market, it has to first understand the local market and regulatory environment. Currently, we are in the process of understanding the regulatory environment.

Does your bank have any exposure to any Indian companies either directly or by way of Chinese companies trading with Indian companies, on its books?

We have that exposure. Many Chinese companies which trade with India have accounts with us.

Your delegation is scheduled to meet the Indian regulator. Is there any specific issue on the agenda?

We would certainly want to know India's policy towards foreign banks. We also want to understand how the interest rates are determined in the Indian market.

Do you see any similarities between the prevailing monetary conditions in India and the inflationary conditions witnessed in China recently?

Indeed, there are similarities. In the past two years, we have seen signs of overheating in our economy. Interest rates are also on the rise. Our regulatory authorities are taking steps to deal with the situation.