NEW DELHI: Barclays Bank PLC India on Thursday said it will infuse at least $400 million (Rs 3,000 crore) in India operations to tap the revival in corporate credit demand as the economic activity gathers momentum.
This is the UK-based bank’s single largest capital infusion so far in its India operations and comes after the lender had quit the retail business in Asia’s third-largest economy with a combined asset size of around Rs 3,200 crore in 2011.
With this infusion, its invested capital in the country will increase to more than Rs 8,300 crore. In 2019-10, it had pumped in Rs 540 crore. The fresh round of capital would help grow its corporate and investment banking as well as private clients businesses, Barclays said.
“The capital infusion in the bank reflects the success and strong track record of our India franchise built over the last three decades. As economic activity gathers momentum, there is increased demand for capital from clients,” said Jaideep Khanna, Barclays CEO for India.
As of the first quarter of FY22, Barclays India’s Tier-1 ratio stood at 14.71% (FY21:14.23%), according to India Ratings. With the fresh capital infusion, Barclays India’s Tier-1 capital has increased by 55%.
Barclays India mainly lends to corporates with exposures largely to highly-rated clients and subsidiaries and operations of multinational companies as well as private clients business for high and ultra high networth individuals and family offices.
Barclays India has direct head office linkages with Barclays Bank PLC, and India’s liquidity and risk management practices are aligned with global practices with the former benefiting from the latter’s oversight and management expertise.
The majority of Barclays India’s loans constitute bill discounting (42% of the loan portfolio in FY21) and working capital loans (43%) which are mostly short-term.