ICICI Bank acquires Russian bank

Mumbai: ICICI Bank has acquired a little-known bank in Russia with a single branch. The bank has purchased the entire paid-up capital of Investitsionno-Kreditny Bank (IKB) in Balabanovo in the Kaluga region with a branch in Moscow. The seven year-old IKB had total assets of about $4.4 million as of 31 March 2005. ICICI Bank did not disclose the purchase consideration.

Kalpana Morparia, deputy managing director, ICICI Bank, said the acquisition was made to gain an entry into Russia.

"This will straightaway give us a vehicle to go to the banking market in Russia. In the normal course, it would have taken two years for the bank to get a licence. With this acquisition, we can access the deposit base directly," she said.

The only other Indian banking venture in Russia is a joint venture between State Bank of India and Canara Bank.

ICICI Bank's immediate strategy would be to garner business through the India-Russian trade link.

As Indian corporates set up operations in Russia, the bank can look at providing them credit. The long-term plan is to explore the opportunities of the deposit base and build on it, she added.

"We will look at the Russian domestic retail base, as there are very few foreign banks in Russia," Morparia said.