New Delhi: Buoyed by an unprecedented rally at the Indian stock markets, ICICI Bank is expecting, on an average, a surge of 65%-70% in its private banking business.
This business usually consists of managing wealth of those who have surplus investment income of over Rs10 lakh annually.
“With the ongoing bull run at the Indian stock markets and the number of domestic entrepreneurs maturing after 15 years of liberalisation, we expect a growth of 65%-70% in the domestic private banking market,” ICICI Bank’s Global Private Banking Head Anup Bagchi told reporters here on Monday.
He said personal wealth industry of Asia-pacific region is estimated at around $7.6 trillion, and as per estimates, India has witnessed the second largest growth in High Net worth Individual (HNIs) population at 18.3%, with Singapore leading with 20% growth.
He said the bank was already catering to over 1.5 lakh customers in this market, out of which a significant number was from the fast-growing millionaire club in India.
However, he declined to disclose the total business of the ICICI Bank’s private banking division.
The division was recently presented the “Outstanding Regional Private Bank - Asia Pacific” award at the 17th Private Banker International Wealth Management Summit 2007, he said.
The term HNI refers to individuals and families that are affluent in their wealth holding and consequently have a higher risk profile, usually with an asset base of Rs1 crore to Rs5 crore.
Bagchi said since India does not have any inheritance tax, such investors could diversify their income by investing in unlisted companies and by exploring new options apart from traditional “Private Trust” route.
Segregation of private wealth from professional wealth, inheritance of large properties and ESOPs to the corporate executives are also driving the private banking, he said.
Considering the number of people buying houses worth Rs1-1.5 crore, growing number of S-Class Mercedes cars and block deals of over Rs100 crore at stock exchanges, one could imagine the potential in this market, he said.
He said the ICICI bank is poised to offer private banking with a large branch network and its capability to offer various services.
“The Bank has also successfully developed global capabilities in offering a wide range of banking financial solutions from our offshore offices which span 18 countries,” Bagchi said.