Latin America's largest lender Itau eyes a share of India's banking pie
NEW DELHI, MUMBAI : Latin America's largest lender Itau is looking to open a branch in India, two people aware of the development said. Representatives from Itaú Unibanco Holding SA's retail, wholesale and asset management divisions held preliminary talks with government officials in New Delhi and expressed their willingness to open shop in the country, the people cited above said on condition of anonymity. Foreign banks seeking to enter India need to secure approval from the Reserve Bank of India (RBI).
Approval for the Sao Paulo-based Itau may be linked to Brazil allowing an Indian bank to open a branch there. For now, State Bank of India is only Indian bank operating in Brazil through a representative office. The RBI allows foreign banks to open branches or wholly-owned subsidiaries in India.
Despite the regulator's preference for the latter, most foreign banks in India operate through the branch model. Itau's branch plans come two years after Brazil became India’s fifth-largest trading partner. In an email response to a query, a spokesperson for Itau said, "there are no negotiations for the bank's operation in India at the moment".
An email query sent to an RBI spokesperson remained unanswered. India had 45 foreign banks – of which two have India subsidiaries and the rest operate as branches — as of 31 January, showed data from RBI. The world’s fifth largest economy has also seen a fair number of foreign banks shut shop in the past decade.
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