India is the only market among the Bric nations (Brazil, Russia, India and China) where Credit Suisse Group, ranked 47 on the Fortune Global 500 list this year, has not become a dominant player in investment banking services. “India is a weakness that we are going to address,” Paul Calello, chief executive of Credit Suisse Investment Bank and a member of the executive board of the Zurich-based group, said in an exclusive interview with Mint.
Paul Calello, CEO, investment banking division, Credit Suisse Group
In India, Credit Suisse is known as the investment bank that ‘saved’ the Tata-Corus deal, doubling up as the adviser to Corus as well as the lead financing bank for the Tata group, in the $12.5 billion deal. Edited excerpts:
What kind of businesses are Credit Suisse doing in India right now?
There are about 100 people in our Mumbai office. We have an established institutional equity broking business in India. We currently have about 4% market share in equity broking for foreign institutional investors (FIIs) who invest in India. Apart from this, we hold licences for merchant banking and portfolio management services in India. We have not applied for an asset management licence. However, we are looking to offer our full range of services in India.
The M&A business across the globe is on shaky ground in the wake of the crisis in credit markets. When do you see more jumbo deals from India happening?
Events in the US markets have dislocated the M&A market. However, there is no reason why we should not see double-digit growth in M&A activity in India over the next few years. We continue to see the potential for more jumbo deals, particularly in the industrials, real estate and software sectors.
How would you rate the investment banking business in India?
India is a top-tier market. We have prominent presence in all other Bric markets except India. In fact, India is a weakness that we are going to address. We have a strong presence in China. We have helped Chinese companies raise about $5.45 billion from the international market, more than any of our competitors.
The Securities and Exchange Board of India (Sebi) had suspended credit Suisse’s broking licence in India in 2001 on charges of price manipulation. You have had recent interactions with Sebi, too. How have these been? What changes do you see in the regulatory environment in India?
The interaction with the Indian capital market regulator has been very positive. We had also interacted with them (Sebi) while applying for an FII licence well before we (re)filed our application for equity brokerage business.
I believe that regulators across all markets including India have become more efficient ... The India economy itself has seen great changes ...