The Association of Indian Banks in the UK in coordination with Asian Voice and Gujarat Samachar organised a working lunch at the new Courthouse hotel, Shoreditch, on Thursday 16th February, to discuss the importance of Indian banks and their contributions to the UK's economy.
The event came at the right time, as Brexit worries loom large over Britain, especially threatening the banking and financial sectors. The discussion was imperative to establish that Indian banking operations here are not affected by the growing uncertainties, and Britain will continue to be the global 'financial hub' as always.
Speakers included Alpesh Patel, G P Hinduja, Sanjiv Chadha, Saikat Sen Sharma, Joginder Sanger and C B Patel.
Alpesh Patel, a UK Government Dealmaker, CEO Hedge Fund & Private Equity, Fintech Investor, Former FT columnist & Bloomberg TV, was the compere for the afternoon. He very lucidly described the importance of Indian banks and introduced the panels.
“These are very exciting times,” said Alpesh. “We have 'Masala bond', 'Coco bond', we have Punjab National Bank called by the UK as the 'Challenger bank'...In terms of innovation Indian banks are the best in banking. When the credit crunch happened, the Indian banks did not suffer as much as the Western banks did. In fact Indian banks were actively hailed for their prudence and management in that entire period.”
He went on to say, “The quality of those involved in banking in India is second to none. Over the last 17 years, see the trajectories of banks… The way the Indian bankers handled demonetisation, how they handled 20bn notes – given the scale of it, it is phenomenal. In the UK we did the opposite, we introduced the £5 note and covered it with beef.
“The reason I say it is an exciting time for Indian banks, principally is this, Indian banks paid £650mn in corporation tax just last year. That is more tax than Google, Amazon and what Starbucks paid.”
Patel added, “The bankers in India are the truest example of the best we work with the government. Soft Bank announced they are going to open $100bn firm – that is the whole money Silicon Valley raised in venture capitalism, and an Indian will be heading that firm...”
C B Patel, Publisher/Editor of Asian Voice and Gujarat Samachar said: “In 1992, we, ie Lord Dolar Popat, Subhash Thakrar and I, met Sir Eddie George, the Governor of the Bank of England at his offices. This was in the aftermath of the collapse of BCCI (Bank of Credit and Commerce International). At least two Asian owned and managed British banks, Equitorial Trust bank and Mount Credit bank were under unwarranted pressure and Sir Eddie George was kind enough to also invite the administrators of these banks at the meeting.
“We had prepared a proper dossier on the hardship of depositors, creditors and staff of these banks who were predominantly Asian. Sir Eddie gave due consideration to our submissions and appropriate measures were taken to alleviate the undue hardship.
“In the dossier we prepared, we highlighted how UK based Indian banks (at that time all were nationalised) had lent £2bn to their UK customers. Today there are so many other private banks too, and the lending by Indian banks is probably more than £10bn.
“The Department of International Development (DfiD) has given away £265mn as aid, including to India. Now India does not require aid. As the current Indian High commissioner Y K Sinha has rightly pointed out, we want more level playing fields for trade.”
CB finally went on to say, “It should be told to everyone that nationalised Indian banks are helping the British economy by several billion pounds. After all Indian owned companies are employing over 100,000 people, predominantly in the UK.”
Concluding his speech, he also praised business tycoon G P Hinduja, thanked hotelier and entrepreneur Joginder Sanger for the great hospitality and described their philanthropy for the diaspora as “something to learn from”.
G P Hinduja told the audience: “We are today living in a world of uncertainties, be it the election of Donald Trump or Brexit... but one thing I can say with certainty is that India is the best destination for investments and Indian banks in the UK have all the capability to become No. 1 in the UK.
“Indian banks have the expertise, though resources are limited. Reserve Bank of India (RBI) should encourage Indian banks to consolidate and see how they can improve trade relationships between India and the UK.”
He also urged the Indian banks in the UK to support small and medium-sized enterprises (SMEs) and hoped that with Indian PM Narendra Modi's backing, “our Indian banks in the UK will become the biggest”.
Sanjiv Chadha, Regional Head, State Bank of India and the Chair of the Association of Indian Banks in the UK, said, “The Indian diaspora is spread all over the world but the UK diaspora is the most outstanding success. It has transformed itself from running corner shops to running the largest and most complex businesses in the country - from being employees to being large employers. As the diaspora has changed so have the Indian Banks in the UK, with development of new products & services to suit the changing requirements of the Indian diaspora, often filling in space vacated by high street banks. Indian Banks often not only offer best rates on deposits and products for remittances to India but are now also offering the best Buy to Let and Commercial Mortgage products. Indian Banks have in the recent past been associated with many marquee deals in the UK and will continue to build on this success."
Talking about their dual presence in the UK, Chadha confirmed that SBI and Bank of Baroda are set to form subsidiaries within the next six months in compliance with the regulatory requirement. Following this, they will function as Branch for their wholesale business and as Subsidiary for the Retail operations.
“We may not be the biggest names in the UK but we offer the most competitive products and services to our clients and as we go ahead, Indian banks will play a greater role in contributing to the UK economy for which we are willing to go that extra mile by offering services like 7 day banking,” he added.
Saikat Sen Sharma, Counsellor (Economic) at Indian High Commission in London, concluded: “Our relationship and strategic partnership between the two countries look great. With the recent visit of the UK PM Theresa May to India, the relationship has grown further. We are one of the largest investors in the UK, creating more than 100,000 jobs, and UK is also the third largest investor in India.
“India sees Brexit more as an opportunity and we are confident London will retain its position as global financial hub.
“At present Indian diaspora is contributing 6% to the UK's GDP. Reforms of financial sectors, Masala bond have picked up. Indian banks are fulfilling their roles, and as devaluation of pound helps, industries here should ensure that you invest in India and explore opportunities available.”
Joginder Sanger, Hotelier and Chairman, Mascroft Ltd, in his short speech praising the diaspora, said, “Indians are very hard working, work seriously and honestly. But one must remember, as my father said, money should not control you, rather you should control money.
Mr Sanger and his wife along with their son Girish and daughter Reema have not only developed a huge business empire, but amongst all such British Indian successful entrepreneurs have provided yeomen services to several organisations and projects, especially in the UK but several in India as well.Bharatiya Vidya Bhavan, The Balaji temple and many more have benefited through the involvement and generosity of the Sanger family. More next week.
