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BNP To Boost Lending Biz Via Sharekhan Finance Arm

Mumbai: French banking group BNP Paribas plans to expand its lending business through a finance arm of Sharekhan — the broking house it acquired nearly three years ago. The group will continue to promote the Sharekhan brand in India — the only market where it has a wholly owned retail financial services company.

Speaking to TOI, BNP Paribas country head Joris Dierckx said that India is an integral part of BNP Paribas Asia Pacific’s strategy. “We have a long-standing presence in India and a more comprehensive offering. So when it comes to investing in growth markets, India is a key country,” said Dierckx.

"Sharekhan has strong brand equity and, therefore, we have invested in refreshing the Sharekhan brand, which has a presence in 500 locations”, said Dierckx. Mutual fund is the only retail business that uses the BNP Paribas brand in the country.

The group’s non-banking finance company (NBFC) arm in India is Sharekhan BNP Paribas Financial Services. It currently offers margin financing and loans against securities to retail and wealth management clients. “If required, in future, we may look at expanding its offering for our corporate and institutional banking clients,” said Dierckx. BNP Paribas — the third-largest broking house in the country after ICICI Securities and HDFC Securities — was targeting the number two position. 

BNP sees a big growth as savers migrate from bank deposits and physical assets to capital markets. “When we acquired Sharekhan, we saw a big opportunity. Indian savings, which today is predominantly in bank deposits and other physical assets, will move into equity investments as interest rates continue to decline. It is not possible to predict the pace at which this migration of investments to equity and debt markets will happen. In Europe, a large part of savings are in equity markets through the mutual fund route,” said Dierckx.

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