The banking sector is transforming, and competition is now extending beyond simply providing loans to clients and attracting deposits. Major banks are actively entering new markets and developing their operations abroad. As part of this trend, the state-owned Indian Bank has developed its future strategy, planning to enter new areas and strengthen its presence in international markets. The implementation of this entire plan may take about a year.
Preparation for entry into two new segments
Indian Bank is preparing to enter the life insurance and mutual fund sectors. The bank is in the process of obtaining board of directors approval for these two sectors. Binod Kumar, the Bank's Development Manager and CEO, stated that this plan is under development. Entry into these markets is planned through the creation of a subsidiary or a joint venture. Necessary administrative and regulatory procedures will begin after receiving approval from the board of directors. According to Kumar, such activities help not only increase the organization's revenue but also strengthen its brand.
Finding a reliable partner is a priority
Binod Kumar noted that the entire process could take about a year. He emphasized that choosing the right and quality partner is the most crucial part of this strategy. He added that with a good partner, the potential for capital creation (revenue increase) increases. This is why the bank is focusing on finding a suitable partner rather than rushing.
Existing presence in the insurance sector
Operations in the insurance sector are not entirely new for Indian Bank. The bank is already active in general insurance. Indian Bank owns 28.52% of Universal Sompo General Insurance Company. This stake was acquired by the bank following the merger of the old Allahabad Bank with Indian Bank in 2020. Universal Sompo General Insurance was established in 2007 and is a joint venture. Indian Bank holds a 28.52% stake, Indian Overseas Bank holds 18.06%, and Karnataka Bank holds 6%. Daber Investment Corp holds a 12.81% stake, while the majority (34.61%) belongs to Sompo Japan Insurance from Japan.
Expanding international presence
Indian Bank's strategy is not limited to new business lines. The bank is also working to strengthen its position abroad. Currently, the bank has a full-service international branch in Singapore. It has branches in Colombo and Jaffna in Sri Lanka. Additionally, the bank operates an IFSC Banking Unit in GIFT City, located in Gandhinagar, Gujarat.
New office in Dubai
The next major direction for the bank's international expansion is Dubai. The bank intends to open a representative office there. The goal is to leverage business opportunities associated with the large Indian diaspora in West Asia. Binod Kumar reported that the GIFT City branch brings good revenue to the bank, including participation in several syndicated loans. He also noted that Dubai has a large population of Indian expatriates (NRIs), accounting for about 33% of the working population. The bank's board of directors has already approved the opening of the representative office in Dubai; necessary regulatory approvals are now awaited.
Considering Malaysia and Indonesia
In addition to Dubai, Indian Bank is exploring opportunities in Malaysia and Indonesia. The bank is examining options to increase its presence in these markets. This indicates that the bank's international expansion strategy is no longer confined to existing branches and units but includes seeking business opportunities in new territories.
