Date:27/05/2006 URL: http://www.thehindubusinessline.com/2006/05/27/stories/2006052704390600.htm

Back StanChart plans to set up asset recovery company

Our Bureau

Venture with J&K Bank, Central Bank, Union Bank and OBC by year-end

KEY MARKET: Mr Neeraj Swaroop (right), CEO-India, Standard Chartered Bank, and Mr Sundeep Bhandari, Regional Head, Global Markets - South Asia, at a press conference in Mumbai on Friday. - Shashi Ashiwal

Mumbai , May 26

Standard Chartered Bank has registered a 51 per cent increase in profit after tax, in its Indian operations, during 2005-06. The bank's profit stood at Rs 905.9 crore this year compared to Rs 601.6 crore last year.

This is due to the buoyancy in the economy, diversification in revenue and product lines, expansion to newer geographical markets and past recoveries, Mr Neeraj Swaroop, CEO-India, Standard Chartered, said at a press conference here.

Wholesale banking and consumer banking have contributed about 75 per cent and 25 per cent to the bottom line, respectively.

Deposits fuel revenue

Revenue has grown by 28 per cent to Rs 3,877.9 crore. It was fuelled by a 26 per cent increase in deposits and 20 per cent increase in advances, said Mr Sanjeev Agrawal, Chief Financial Officer, India and South Asia, Standard Chartered.

The bank has plans to set up Assets Recovery Company (ARC) along with Jammu and Kashmir Bank, Central Bank of India, Union Bank and Oriental Bank of Commerce by the end of this year.

The bank invested over Rs 1,300 crore in India, last fiscal. India continues to remain one of the top three strategic markets for Standard Chartered, the other markets being Hong Kong and Korea. The cost to income ratio for the year was down to 35.9 per cent compared to 44.1 per cent last year.

The bank has recorded after tax recoveries at Rs 80 crore and the provisioning has been lowered down to Rs 100 crore from Rs 170 crore last year. Net interest income has shown a 35 per cent rise, from Rs 1,385 crore last year to Rs 1,866 crore this year.

The bank expects to expand its services to 100 cities in the next few years and has sought RBI approval to set up new branches in the under-banked areas, Mr Swaroop said.