Lok Sabha Question No. 3208 (UNSTARRED), answered on 2018-01-05
Subject: SBM Subsidiary in India
Ministry: FINANCE
Asked by: RAJEEV SHANKARRAO SATAV, HEENA VIJAYKUMAR GAVIT, JAYAKUMAR JAYAVARDHAN, DHANANJAY BHIMRAO MAHADIK, VIJAYSINH MOHITE PATIL, P.R. SUNDARAM

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA

## UNSTARRED QUESTION NO. 3208

TO BE ANSWERED ON THE 5 TH  JANUARY 2018/ PAUSHA 15, 1939 (SAKA)

## SBM Subsidiary in India

## 3208.  SHRI SATAV RAJEEV:

DR. HEENA VIJAYKUMAR GAVIT: DR. J.JAYAVARDHAN: SHRI DHANANJAY MAHADIK: SHRI MOHITE PATIL VIJAYSINH SHANKARRAO: SHRI P.R. SUNDARAM:

Will the Minister of FINANCE be pleased to state:

(a)  whether the Reserve Bank of India (RBI) has given approval to State Bank of Mauritius (SBM) to open a wholly owned subsidiary bank in India;

- (b)  if so, the details thereof;
- (c)  whether the interest rates for lending and borrowing of SBM will be regulated by RBI rules, if so, the details thereof;

(d)  whether any other foreign bank has approached RBI for clearance regarding opening local unit in India, if so, the details thereof;

- (e)  the purpose behind allowing foreign banks to operate from India; and
- (f)  the steps taken by the Government to safeguard citizen privacy in the international market as a result of this step?

## ANSWER

The Minister of State in the Ministry of Finance (SHRI SHIV PRATAP SHUKLA)

(a) and (b): Reserve Bank of India (RBI) has informed that licence was issued to the Wholly Owned Subsidiary (WOS), SBM Bank (India) Limited on December 6, 2017, to carry on banking  business in India,  whereby  the  branches  of  SBM  Bank  (Mauritius)  Limited  (formerly  State  Bank  of  Mauritius Limited) will be merged to operate as a WOS, subject to regulatory guidelines as applicable to other domestic banks in India, with restrictions on opening branches in some sensitive areas.

(c):    All  operations  of  SBM  Bank  (Mauritius)  Ltd.  in  India,  including  lending  and  borrowing,  are regulated by RBI rules.

(d):  Details of the applications of foreign banks currently under examination is at Annex.

(e): Allowing foreign banks to set up presence in India facilitates trade and investment between India and the home countries of foreign banks.

(f): RBI has issued a circular on secrecy obligations relating to furnishing of data which indicates that the  scope  of  the  secrecy  law  in  India  has  generally  followed  the  common  law  principles  based  on implied contract. Foreign banks operating in India are required to follow the same.

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## Lok Sabha Unstarred Question No. 3208 for 5.1.2018, regarding 'SBM Subsidiary in India'

## Applications of foreign banks under examination

|   Sl. No. | Bank                                    | Country of incorporation   | Request                                                                                                                     |
|-----------|-----------------------------------------|----------------------------|-----------------------------------------------------------------------------------------------------------------------------|
|         1 | Industrial and Commercial Bank of China | China                      | Application for second branch in New Delhi                                                                                  |
|         2 | Bank of China                           | China                      | Application for maiden branch in India                                                                                      |
|         3 | Bank Pasargad                           | Iran                       | Application for maiden branch in India                                                                                      |
|         4 | Parsian Bank                            | Iran                       | Application for maiden branch in India                                                                                      |
|         5 | Saman Bank                              | Iran                       | Application for setting up a representative office in India                                                                 |
|         6 | Kookmin Bank                            | South Korea                | Application for maiden branch in India                                                                                      |
|         7 | KEB Hana Bank                           | South Korea                | Application for second branch in India                                                                                      |
|         8 | Nonghyup Bank                           | South Korea                | Application for maiden branch in India                                                                                      |
|         9 | Woori Bank                              | South Korea                | Application for setting up a Wholly Owned Subsidiary (WOS) in India by converting its existing branches in India into a WOS |
|        10 | Bank of Ceylon                          | Sri Lanka                  | Application for second branch in India                                                                                      |
|        11 | Maybank                                 | Malaysia                   | Application for reconsideration of Government's decision to reject its application for maiden branch in India               |
|        12 | ING Bank                                | Netherlands                | Application for setting up a representative office in India                                                                 |
|        13 | Cooperative Rabobank UA                 | Netherlands                | Application for second branch in India                                                                                      |
|        14 | PPF Banka a.s.                          | Czech Republic             | Application for setting up a Wholly Owned Subsidiary in India                                                               |

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