Indian bank targets growth in NZ

Bank of India chairman Alok Misra says the bank's New Zealand venture is a win-win for both countries. Photo / Natalie Slade

Bank of India opened its doors to New Zealanders this week as part of an expected surge of 10 million customers in its global base.

A wholly owned subsidiary of the bank, which was established in 1906, was inaugurated by Reserve Bank Governor Alan Bollard on Thursday with the first branch opening its doors in Auckland.

Bank of India chairman Alok Misra said few countries were showing growth - New Zealand was one and India another.

"In the emerging economies we find that their requirements will continue to rise," Misra said. "India has a huge middle class, large amount of trade is likely to happen and this would require that we look at countries that are of the same type."

Bank of India has more than 48 million customers globally, with growth of about 8.6 million last year and another 10 million expected this year, Misra said.

"With trade increasing between India and New Zealand, it is the right time for Bank of India to establish a presence in New Zealand."

Bank of India is the second Indian bank to establish a presence in New Zealand, the first being Mumbai-based Bank of Baroda, which gained a local banking licence in 2009.

The new bank gave New Zealanders access to 19 other countries through its network "and the single most important thing is you get [the] Indian market", Misra said. "I think it's a win-win for both [countries]."

The bank could help businesses here by contacting branches in India to check the worthiness of potential partners, and planned to open more branches as it developed, with retail customers followed by business.

"If the customer service is good, the products are good, they're well priced, they [customers] will surely come," he said.

"As you grow, you get your niche. If a person is from the [small to medium enterprise] or the agriculture, he finds that Bank of India's good for him - he'll come to us."

There were 120,000 people in the New Zealand Indian community who were a natural choice for the bank, Misra said

The bank employed six people in New Zealand and was targeting a minimum of $25 million in deposit advances in the first year.

"This is the first day ... as the branches open up more people will be taken [on]," he said.

The company would offer services available at other banks including credit cards and online banking, and was working on a scheme with Westpac for access to cash machines.

Since the financial crisis of 2008, India banks were well regulated and capitalised, Misra said.

"We have done the restructuring of the very difficult loans to ensure that they get more breathing time, they could weather this storm which came suddenly," he said.

"All those kind of things we did but I think the Indian banking system is quite robust, well capitalised, well skilled and I would say they're good at it."

Bank of India
* Established in 1906.
* More than 48 million customers.
* 19 countries and 49 offices.
* First branch opens in Auckland.