CANBERRA: Commonwealth Bank, Australia’s largest lender with $695 billion in assets has become the latest foreign bank to shut down its Indian business following the footsteps of its larger global peers in exiting a market in which competition is tough. “After careful evaluation of our Indian business alongside our refocused strategy, the decision has been made to wind-down close the Mumbai branch. We will be contacting you in the coming weeks to provide more information on what this means for you and your banking relationship with us,” the bank said in a notice on its website.
Commonwealth Bank was the first Australian bank to open a branch in Mumbai when it started its operations in the city in August 2010 to provide trade finance, remittance and foreign exchange services attracted by the high potential for trade between Australia and India.
Latest financial figures available on the bank’s website in India show that it made a loss for two consecutive years in the fiscal year ended March 2015 and March 2014 although net loss in fiscal 2015 shrunk to Rs 2.44 crore from Rs 3.84 crore in fiscal 2014. No official from the bank was available for comment. However, Commonwealth Bank’s decision to exit India does not come as a surprise as in the last five years, banks ranging from Deutsche Bank to Barclays to UBS to ING have either partially or fully shut operations in the country.
British bank Hong Kong & Shanghai Banking Corp. (HSBC) was the latest among the big foreign banks in the country to shut a part of its operations as in May it announced that it will shut 24 of its 50 branches in India and reduce its presence to 14 cities in the country as it seeks to push more retail and wealth management business to the online channel.
