Dresdner Bank Ag:Establishing A Firm Base

Q:Your Mumbai branch will be shortly completing two years of operations. What are your achievements during this time?

A: The initial months were spent in assembling a good team of senior managers, firming up a business plan and setting up proper procedures and controls to enable us to deliver a range of products and services to our target market. After completing this, we then started to tap our target market. On the whole, we believe that we have been able to add value to the operations of our customers, and have built up enduring relationships with a wide cross section of companies in India.

 

Q: What is the competitive edge of your bank in the Indian market?

A: Dresdner Bank AG has a network of over 1600 branches spread over 70 countries. The July issue of The Banker magazine, ranks Dresdner Bank AG as the thirteenth largest bank in the world, based on assets totalling US$ 355.6 billion. Together with its subsidiary, Dresdner Kleinwort Benson, our group offers a wide range of products such as corporate finance, both debt and equity, foreign exchange and interest rate risk management services, project finance, both funding and advising, and specialised services to high net - worth individuals. Also, because of its wide network in Germany, and its long standing connections in India, the Bank handles 13% of the Indo - German trade. These strengths enable us to offer our customers a wide range of products and services which are competitively priced. Dresdner Bank has been operating in highly competitive and deregulated international financial markets. This makes us proactive in spotting potential business opportunities and finding solutions to specific customer needs.

Q: What role is your bank playing to boost German investments in India?

A: This is a very important point. Potential investors and firms investigating business prospects in a particular country, conduct wide - ranging research into all aspects of business, including the target market, tax regime, infrastructure, legal structure, financing practices, regulatory environment etc. Although information may be accessed from a variety of sources including government bodies, chambers of commerce, prospective business partners, buyers - suppliers, the investor often views his bankers opinion as an important objective input. He sees the banker as the one who would be interested in ensuring the viability of the proposed investment or enterprise. Given our banks extensive relationships with investors and business in Germany, its presence in India through its bank branch, and its wholly owned Investment Banking and Stockbroking companies under the name Dresdner Kleinwort Benson, we have been frequently consulted by intended investors. More importantly, on four occasions in the past two years, the Banks senior Indian banking staff, toured various German cities, informing prospective investors about the investment and business opportunities in India. Another such tour of german cities is planned for September 1997.

Q: What are the major differences between the German and Indian financial markets?

A: The major differences between the two are:

Absence of exchange control regulations in Germany

Absence of a deep and liquid money market in India. The interbank market in India is an overnight money market, with limited depth and is therefore volatile.

As the Indian financial markets are not integrated with the global financial markets, the banks are unable to offer certain financing and risk management products to its customers in India.

With the proposed reforms, including the capital convertability, Indian financial markets will integrate with global financial markets, and these differences will disappear over a period of time.

Q: Having built a good base, what are the future plans of the Group?

A: Dresdner Bank AG, its investment banking subsidiary Dresdner Kleinwort Benson Securities (India) Ltd. plan to increase their activities in project finance, trade finance, corporate debt and equity markets, and also the high - net worth individuals segment. The Bank would also like to expand its geographical presence in India.

Q: How does your bank view the opportunity of funding infrastructure projects in India?

A: Globally, infrastructure funding is a thrust area of Dresdner Bank AG. The Bank tops the league tables of both project finance arrangers and project finance providers, ahead of all global lending agencies. The June publication of Project and Trade Finance News provides the latest 1997 data on this.

Dresdner Bank AG has over 100 project finance specialists located around the world, with project appraisal skills for infrastructure projects such as power, telecommunications, oil & gas etc. The bank has already financed some infrastructure projects in India, and the branch in India is actively pursuing syndications of ECB loans for infrastructure projects.