ICICI Bank in Big Apple

ICICI Bank's three-year-long wait to open a branch in the US has finally ended, with the Federal Reserve Board approving its application for opening a branch in New York.

India's largest private sector bank would engage in wholesale banking, including trade financing and factoring services, to US-based subsidiaries of Indian firms, the Federal Reserve said.

The branch will be an efficient way to service clients, ICICI Bank Joint Managing Director Chanda Kochhar said, adding the branch would also allow to raise resources in the US markets.

Kochhar said the approval was clearly an acknowledgement that the US was satisfied with the steps India had taken on the anti-money laundering front.

The bank, the Fed said, had policies and procedures to comply with the Indian laws and regulations and the Reserve Bank of India guidelines regarding anti-money laundering. Besides, it has also taken additional steps on its own to combat money laundering and other illicit activities. The bank's application, they said, met the requirements of the International Banking Act and was also supervised by the Reserve Bank of India.

The regulators also found ICICI Bank's risk management standards consistent with those established by the Basel Capital Accord and its capital was in excess of the minimum levels that would be required by it. The bank already has a small team working in New York at its representative office. It has already short-listed people, who will be recruited in the US as well as India. Work on setting up technology systems will start now.

The capital requirement is likely to be specified by the Office of the Comptroller of the Currency. Meanwhile, Indian Bank's Association Chief Executive H N Sinor said, "It was long overdue. In most of geographies, our Know Your Customer (KYC) and Anti-Money Laundering (AML) have already been acknowledged."

SBI and Bank of Baroda have already expressed interest to expand operations in the US, he added.