In financial terms the acquisition is quite small for Standard Chartered India, which has a domestic balance sheet of Rs.373 billion. Bank of Bahrain and Kuwait has a balance sheet size of Rs.6 billion.
However, the bank plans to leverage its acquisition to play a larger role in the increasing trade links between Kuwait and India. Standard Chartered has received in principle approval for the takeover from IndiaÆs central bank, the Reserve Bank of India (RBI). It will seek final approval from the RBI after itsÆ own shareholder approvals are in place.
This completes a hat trick for Standard Chartered in India which has successfully used the acquisitions route to grow its business. In 2000 it bought out the Australia and New Zealand Banking Group Ltd,Æs (ANZ) operations in the Middle East and South Asia and GrindlaysÆ associated private banking business.
This was a large acquisition adding 116 branches across 13 countries. In India specifically ANZ Grindlays had 29 branches across 15 cities at the time of the takeover, adding considerably to Standard CharteredÆs own presence of 19 branches across eight cities. The subsequent merger of Grindlays into Standard Chartered in 2002 catapulted Standard Chartered to the number one position among foreign banks operating in India, in terms of branch network.
In September, 2004 Standard Chartered acquired the Indian operations of Sumitomo Mitsui Banking Corporation. This comprised branches in Delhi and Mumbai and a trade finance, loan syndication and cash management business.
Standard Chartered has been operating in India for well over a century since it opened its first overseas branch in Kolkata (Calcutta) as The Chartered Bank in 1858. Standard CharteredÆs operations are mainly in Asia, Africa and the Middle East.
It is estimated that three quarters of the bankÆs profits arise from Asia. Within Asia India is an important part of the bankÆs strategy. In February, 2006, Mervyn Davies, chief executive commented, ôweÆre confident in our strategy of organic growth supplemented by alliances and acquisitions if we see value.ö