South Africa's FirstRand Bank may emerge as the maiden foreign lender to adopt the wholly-owned subsidiary route after Reserve Bank of India (RBI) unveiled the long awaited final norms earlier this month.
According to sources, the Indian arm of the lender will start discussions with their parent in South Africa to obtain necessary approvals. After the parent's board approves the proposal, the Indian arm will submit its application with the Indian regulator.
FirstRand Bank started operations in India in 2008 and has a sole branch in India, at Mumbai. Since South Africa has no restriction on foreign branches regarding their branch expansion, FRB is likely to gain from the reciprocity clause of the WoS norms.
Banks from US and from several European nations may not be given near national treatment even if those bank convert them into subsidiaries.
