Mumbai: Standard Chartered Bank’s India operations on Tuesday reported a 12% growth in net profit at Rs1,907 crore for the fiscal ended 31 March, up from Rs1,706 crore for the previous year.
The double-digit growth in profits has been driven by a 33% growth in non-interest income. The bank’s income grew by 22% to Rs8,747 crore.
Path to profits: A Standard Chartered Bank branch at South Extension, New Delhi. The lender is in the process of revamping its consumer banking business in India as it looks to focus on affluent customers. Madhu Kapparath / Mint
“We have been growing rapidly in the last four-five years. We almost tripled both our revenues and profits from 2003 to 2008,” said Neeraj Swaroop, regional chief executive, Standard Chartered Bank, India and South Asia. “In 2010 to 2011, the growth will be moderate as the base is high. Given our scale, we will continue to grow our consumer and wholesale banking business.” The bank’s deposit base grew to Rs41,802 crore from Rs37,004 crore, while its advances increased 12% to Rs37,516 crore.
Standard Chartered, which has had a presence in India since 1858, has 90 branches across the country and has approval from banking regulator Reserve Bank of India to open four more.
It was the second largest contributor to the UK-based group’s profits in 2008. Its parent uses January to December as its accounting year. The group has invested $527 million into its India operations through a combination of debt infusion and profit retention as of March.
The bank’s capital adequacy ratio in India at the time stood at 11.56, while its non-performing loans increased to 1.37% from 1.04%.
The lender is also in the process of revamping its consumer banking business in India as it looks to focus on affluent customers. “We have been very strong on the unsecured side particularly on the personal loans and credit cards with a moderate focus on secured business,” Swaroop said. “However, going forward we will grow the secured piece of the business which includes mortgage loans, wealth management and small and medium enterprises.”
In assets, secured consumer loans accounted for 70% of the bank’s consumer book. It plans to increase this share to 80% in the next two-three years.
“On the unsecured side, the credit card and personal loan business, which was largely driven by the direct sales agents in the past, will now be sourced by bank employees and branches,” Swaroop said.
Given its strong performance in the Indian market, the bank has also been considering a listing in the Indian markets.
“India is a big market for us. If we do a listing in India it will be to demonstrate our long term commitment to India. However, the bank board has yet to be consider listing,” Swaroop told Mint last week. Besides London, the lender is listed only in Hong Kong.