)
You are operating in India for 18 years and the focus has been more on institutional clients. Do you also want to expand consumer banking activity?
Consumer banking contributes only three per cent to the total India revenue. In the long run, it is intended that the contribution to revenue be at least 25 per cent.
We should also measure the contribution in proportion to the liabilities. At the end of last year (2012), it was 40 per cent, a significant contribution. The contribution cannot be measured in the proportion of revenue because we do not have asset products. Retail liabilities are a more stable source of funding, so we will continue to focus on these. Our objective is to raise retail liabilities.
Last year, how many customers did you add from the retail liabilities side?
About 3,500-4,000 customers in 2012, taking our total customers in retail liabilities to around 25,000.
You want to grow your retail liabilities but offer only four per cent interest on savings bank accounts, while some private banks with similar objectives offer more.
Each bank will have its own asset-liability management concerns, determining what rates they want to offer. We had a fair degree of success with the offering of four per cent. Our concentration and efforts are to provide better service and a consistent level of service to our client base. We have not felt any need for offering higher than four per cent to meet our objectives. A lot of banks still offer four per cent.
Any plans to start offering retail assets?
Our first attempt is to have a stable source of long-term liability. Once we do and we are able to sustain that, we will think of entering into the assets space.
What is the strategy to grow the bank’s business in India?
We have a small share in the total market. We have connectivity with a lot of customers and those are likely to grow over this year as well. That will provide opportunities to us for growth. We have also increased our coverage in the liability space in consumer banking. On the liabilities side, we are targeting growth of at least 35 per cent this year.
We also have presence in the small and medium enterprises space and we want to grow it aggressively, especially in liability management and cash management. On the corporate sector, we have connections with large accounts and we expect to add a few more relationships there and selectively grow our assets in that space as well. We would expect our balance sheet to grow at least 20-25 per cent in 2013.
What are your branch expansion plans this year?
Branch expansion is a function of permission from the Reserve Bank of India. If we get more branches, we will grow. Now, we are waiting for the announcement on wholly owned subsidiaries. Once the regulations on these are out, we will evaluate. We will be very keen to see how we can expand on that.
How much is India's contribution to the revenue stream of the DBS group and what growth can be expected?
India is a strategically important geography to DBS and is in a position to expand its contribution to the group. Even other economies where we are operating are expanding. We would like to have a double-digit contribution from India.
