Kerala based Federal Bank, with its Rs 48,000-crore business, is looking
to enter the wealth management space, especially for catering to its
huge NRI clientele.. The bank has a good four lakh NRI customers. This
base, according to bank's chairman and CEO M Venugopalan, throws up
a solid business opportunity for the bank. Mr Venugopalan expects to
firm up this plan in the next three months. The banks overall customer
base is nearly 50 lakh.
Wealth management means advanced investment advisory, including offering
financial planning and tailor-made financial services in retail banking,
estate planning, taxation, among others. These services are typically
being offered to high net worth individuals (HNIs). The bank chairman
has ruled out the possibility of entering into the asset management
space directly. "This is not the right time to think over a foray
into asset management business," he said. However, Mr Venugopalan
has indicated that BCG was also asked to weigh potential for a non-life
insurance venture. Federal Bank, along with IDBI Bank and Fortis, has
already started selling risk covers in the life insurance space.
"BCG will prepare a five-year business transformation road map
for the bank. It will advise us on expansion and geographic spread,
explore niche areas for business and overall strategy. The consultant
will submit its report in the next six months," the top banker
said. Regarding talks of a Federal Bank-Catholic Syrian Bank merger,
he said: "Nothing is on cards at this point in time. In general,
we are open to mergers."
