UAE offers banks robust opportunity

CICI Bank’s KV Kamath speaks about the bank’s operations, its growth strategy and an overview of the banking sector, in an exclusive interview


K.V. Kamath, Managing Director and CEO, ICICI Bank Limited, India’s second-largest bank, began his career in 1971 and has been mainly responsible for the bank’s phenomenal growth in recent times. He has introduced new systems, strategies, services and leadership into the organisation and leveraged technology to turn ICICI into a banking giant.
ICICI Bank is listed on the Bombay, National and New York stock exchanges. It offers services in the areas of corporate finance, commercial banking, investment banking, asset management, non-banking finance, investor services, broking and insurance.


How is the banking and financial sector development in the UAE?
In any country, the banking sector reflects what is happening in the economy. We all know that the UAE economy has been witnessing a robust growth and I hope this boom will mirror on the banking sector too.
Our experience in several countries indicates that financial services typically grow at a two to two-and-half times the economic growth. So, whatever is the economic growth in a country if you multiply it by two to three times it gives you the banking opportunities available in the country. The UAE has been a high growth economy and the banking opportunity here is very robust.

Many Indian companies are acquiring firms overseas. Is your bank advising any such companies?
Indeed, as of this year, we are the largest in terms of providing syndication from India for Indian companies in the global context. We have been involved in almost all the major deals that have happened. These acquisitions are expected to be a growing business and we think this is going to be one of the fastest growing sides of Indian business. Indian companies will look at global opportunities and would like to capitalise on it.

Now that you have opened an office at Dubai International Financial Centre (DIFC) what is your area of focus?
The DIFC office, which started operations two months back, offers wealth management activities to high net worth individuals. In fact, we are the first Indian bank to open an office at the DIFC. The main activity here is private wealth management. We can serve any customer with a net worth of over $ 1 million.

How is the remittances’ business?
The remittance market in India is worth $ 25 billion a year and is growing at 25 per cent annually. It is one of the fastest growing markets in the world. And the Gulf is one the major contributors to this market. One quarter of the remittances into India come from the Gulf countries.

What about your presence in other GCC countries?
Our operations in the Gulf are at the UAE and Bahrain. In the UAE, besides a rep office we have the DIFC branch. We started our Bahrain operations some three years back and very recently have received a licence to start full-fledged banking activity there. And today, Bahrain is the largest international activity branch that we have. This reflects the tremendous potential and opportunity that the Gulf presents. We expect a couple of more licences in the near future.

What are your services provided to NRIs?
There are several things that we are doing with our NRI customers. Our primary product is remittances. Then through our arrangement with Emirates Bank, we distribute Indian product, to be used in India, to our customers here.

Is there any difference in the type of operations you have here and in Bahrain?
Yes. Bahrain is our full-fledged branch where we are offering the entire banking requirement to the citizens. Here in the UAE, the bank provides wealth management activities to high net worth individuals only but in Bahrain we offer our banking services to both locals as well as expats. Also, through the Bahrain office we work on the bigger syndications that I talked about earlier. We raise money from Bahrain and international markets.

How do you plan to face competition from other foreign banks at the DIFC?
Our strategy has been to work with Indian customers who may not be of interest to large major wealth managers. While, global wealth managers want to look at large amounts of money and we are willing to look at customer with smaller base. That is why we are looking at customers with $ 1 million base whereas large wealth manager wants to handle only multi-million dollar customers.