'We are strong development partner of Nepal.'

Neeraj Swaroop, the Chairman of Standard Chartered Bank (SCB) Nepal is based in Mumbai, India. He is an MBA and BE with more than 25 years of experience -- with more than 17 years of experience in India -- in the banking sector including Bank of America and HDFC Bank. He is currently serving as the Regional Chief Executive, India and South Asia. Swaroop was recently in Kathmandu to chair the 23rd AGM of the bank. Myrepublica.com talked to him on various issues.

Excerpts:

Myrepublica.com: Can you please tell us how has been the performance of Standard Chartered Bank in Asia?

Neeraj Swaroop: Let me tell you, Standard Chartered Bank is mainly focused in Asia and Africa as 80 percent of our revenue comes from these two regions. As far as financial results are concerned, the half yearly results for period ended June 2009 shows that we have performed very well. We have generated record profit with an impressive growth of about 20 percent and there was similar growth in revenue as well.

Myrepublica.com: As the global economy is slowly coming out of recession, what kind of strategies the banks should adopt in the days to come to achieve more growth?

Swaroop: I think this is the time to follow a strategy what I call ´back to basics´. We have been a very balanced bank with clean balance sheet and we have business models all over the countries very focused on our clients. We offer a full range of commercial banking services and all of them are very client-centric. We are confident that all the strategies that we have been following are giving us good results. So, I think there is no need of big changes in strategies that we have at the moment. We, however, are planning to increase cross-border international services as our customers in Asia are becoming more international and expanding their activities in buying and selling activities across the countries. So, the banks like ours are in better position to offer those services. Over the past years we have diversified our wholesale banking product lines to include a full range from transaction banking to strategic services, like corporate financing and advisories. We will continue to build up on these areas that we hope will help us grow.

Myrepublica.com: How is the competition that the bank is facing in Asia?

Swaroop: Though there is presence of international banks, strong competition comes from strong local banks. If you take India, where we do have a strong presence, our competition is with local banks like State Bank of India, ICICI and HDFC Banks. Whether you go to Singapore, Hong Kong or Korea, most competition comes from strong local banks. But being an international bank, we offer products and services better than local banks can offer and we differentiate ourselves from other international banks being much more local in operation, as we have been in some parts of Asia for 150 years. So, we are well positioned in this part of the world.

Myrepublica.com: How has been the performance of Standard Chartered Bank in Nepal?

Swaroop: You must have seen the financial results of the last fiscal year which showed impressive growth like net profits crossing one billion rupees. We are enjoying steady growth in Nepal and we are very happy with the results of our performance. As the economy is stabilizing, we are optimistic that we will continue to maintain our growth here. We are a balanced bank and we are here for long-term. We are not building businesses with short-term vision. We balance our revenue growth with proper control procedures and strong credit culture so that we can deliver good results to our shareholders.

Myrepublica.com: There have been debates over the number of banks in Nepal as some have been saying the number is big other say it is OK. How would you like to comment over the debates?

Swaroop: Different countries have different models and policies on number of banks. There are some countries like Nepal that has a large number of banks while some others have a few strong banks. Mostly in a stable banking system, you see a smaller number of strong banks having strong balance sheets. I would expect over a period of time that there will be some consolidation of banks to make larger ones, as there will always be space for some specialized banks.

Myrepublica.com: What are the major challenges that you see for banking sector in Nepal?

Swaroop: What I think is that there is a need of strong economy because banking sector can do well if the economy is strong. I hope that if the political situation stabilizes here, there will be big opportunity for the economy to grow like it has happened in other parts of South Asia. I am optimistic that Nepal´s economy can do much better than what it did in the past. If there is continued stability, the economy can achieve growth of more than 4 to 5 percent a year.

Big opportunity for Nepal is that it has strong linkages with India whose economy is very large and growing at a fast pace. If Nepal can attract investments to explore its natural resources and develop infrastructures, I think it can grow at a much faster pace. And again I would like to stress that as a development partner of Nepal, we are committed to participate in the nation´s development endeavors.

prem@myrepublica.com