News: ‘29 foreign banks operating in India’

(BL 02/09/2006) Chennai - There are 29 foreign banks with 255 branches operating in India currently, according to the Reserve Bank of India's annual report. There are in all, about 288 commercial banks operating in the country having about 68,500 branches.

Under commitments given to the World Trade Organisation, the RBI has to allow 12 branches of foreign banks every year. In the calendar year 2006, so far, the RBI has already given permission to four foreign banks to open 13 branches. Seven other foreign banks have been given permission to open representative offices in 2006. Currently, there are 31 representative offices of foreign banks operating in India.

In 2005 also, RBI had granted permission to eight foreign banks to open 13 branches.

Under its branch authorisation policy, foreign banks will have to bring in an assigned capital of $25 million at the time of opening their first branch and are also required to submit their branch expansion plans on an annual basis. The RBI will take into account the track record of the foreign bank and the group to which it belongs, in compliance and functioning in global markets, the treatment accorded to Indian banks in those countries, as also accord consideration to the bilateral and diplomatic relations between India and those foreign countries.