ICICI: Fortis deal shows global wealth ambitions

27th July 2005

Fortis' private banking division has teamed up with India's ICICI Bank.

India's second largest bank, ICICI, has launched a partnership with MeesPierson, Fortis' private banking arm, to provide a full range of high net worth products and services to ICICI's clients in India and abroad. This link-up makes sense for ICICI, as it can use business gained from expatriate clients to bolster that which it is winning at home in the booming Indian HNW segment.

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As India's second largest bank, and largest private bank, ICICI [IBN] has an enormous client base, comprised of both residents in India and non-resident Indians (NRIs), or expatriates living abroad.

According to Datamonitor research, there are more than 31,000 Indian high net worth expatriates in 17 countries, and more than 230,000 mass affluents. The size of this client base provides a significant opportunity for ICICI, which can market itself on its extensive experience in serving Indian clients.

One problem that any bank has in targeting expatriates is how to reach them. It is often the case that the bank in the expatriate's home market doesn't have an on-the-ground presence in the countries where its nationals have moved. Some large banks, such as Citigroup and HSBC are exceptions. However, for most banks wishing to target expatriates, linkups are the only viable way to reach this audience effectively.

ICICI is no stranger to such alliances. It has already forged partnerships with Lloyds TSB in the UK, Emirates Bank in the United Arab Emirates (UAE) and Commercial Bank in Qatar. The bank also has an agreement with Wells Fargo in the US, Bank of Montreal in Canada and DBS in Singapore for remittance business.

The tie-up with MeesPierson will give ICICI even greater reach. MeesPierson is present in 17 countries, including several locations where ICICI has no presence and where, importantly, there are large populations of NRIs. The arrangement also gives ICICI the opportunity to offer its clients access to several offshore centers including the Channel Islands, Hong Kong, and the Dutch Antilles.

As well as furnishing ICICI with opportunities for geographical expansion, MeesPierson's expertise in discretionary portfolio management and its trust and corporate services will also significantly expand ICICI's product and service offering.

ICICI is clearly determined to court wealthy Indians living abroad, and its assiduous approach to creating joint ventures should bear fruit, allowing it to use overseas clients to build upon its custom from the fast-growing HNW segment at home.
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