DBS bets on ’poisoned chalice’ of India banking for profits

Mumbai/Singapore: DBS Group Holdings Ltd. aims to bolster loans to Indian consumers and small businesses as part of a plan to reduce its reliance on Singapore. Southeast Asia’s biggest bank will push credit through its new wholly owned unit in India, Chief Executive Officer Piyush Gupta said in an interview in Mumbai, where the bank is beefing up both its brick-and-mortar branches and its digital presence to tap the world’s second-most populated nation. “The reality is that for most foreign banks, trying to build retail and small and medium businesses outside their home market has been a poisoned chalice,” Gupta said on Monday. “We are making this bet on India as we believe discontinuity caused by digital channels offer a once-in-a-lifetime opportunity of skinning this cat differently.” A push into major developing markets such as India would help DBS reduce its dependence on Singapore, a tiny island state with a mature economy where it derived 62% of revenue in 2018. The timing might be favorable given that several Indian homegrown banks are hobbled by the world’s worst bad-loan ratio and some foreign rivals like Standard Chartered Plc are considering cutting their presence in the country.