Australia’s largest lender Commonwealth Bank, with $695 billion in assets is the latest banking foreign bank is closing its Indian business following its larger global peers in exiting a market if there is tough competition.
“After careful evaluation of our Indian business alongside our refocused strategy, the decision has been made to wind-down close the Mumbai branch,” the bank said in a notice on its website.
“We will be contacting you in the coming weeks to provide more information on what this means for you and your banking relationship with us.”
Commonwealth Bank was the first Australian bank to open a branch in Mumbai when it launched its operations in the city in August 2010 to provide trade finance, remittance and foreign exchange services attracted by the high potential for trade between Australia and India.
The latest financial statistics on the bank’s website in India show it suffered a loss for two consecutive years in the fiscal year ended March 2015 and March 2014 although net loss in fiscal 2015 shrunk to Rs 2.44 crore from Rs 3.84 crore in fiscal 2014, a media report said.
Commonwealth Bank’s decision to exit India hasn’t come as a surprise as in the last five years, banks ranging from Deutsche Bank to Barclays to UBS to ING have either partially or fully shut operations in the country.
British bank Hong Kong & Shanghai Banking Corp. (HSBC) was the latest among the big foreign banks in the country to shut a part of its operations as in May it announced that it will shut 24 of its 50 branches in India, reducing its presence to 14 cities in the country.