FirstRand cuts presence in India
FirstRand said it’s scaling back its presence in India by converting its branch to a representative office but won’t wind down its operations in the country.
Africa’s biggest bank by market value undertook a review of its strategy in India and “remains committed to its presence” there, according to a statement on Wednesday. The Economic Times, which earlier reported the move, said it’s likely to impact at least 50 jobs in India.
“Whilst it has proved difficult to build a meaningful in-country franchise, the Indian business has successfully focused on facilitating trade and investment activity in the Indo-Africa corridor,” the Johannesburg-based lender said. “This has been a key enabler to FirstRand’s investment banking business’s strategy to grow its offerings on the broader African continent, but which only requires a representative office to execute.”
The announcement follows days after Citigroup unveiled a plan to exit its retail business in India and China, underscoring the frustrating battle for market share international banks face in two of Asia’s largest economies. Increased rivalry from domestic lenders, especially in consumer financing, and fierce competition for top talent contributed to the challenges that overseas banks have often struggled to overcome.
FirstRand, which has operations across Africa and a representative office in Shanghai, already reduced its consumer banking in India almost five years ago. The lender delivered a sign of confidence last month by declaring an interim dividend after withholding its final payout last year while Africa battled the worst of the coronavirus pandemic.
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