ABN AMRO BANK (INDIA) Background ABN AMRO (India) has had a long-standing presence in India, having been in Kolkata and Mumbai since 1920. Traditionally known as a “diamond-financing bank”, it has transformed itself from a bank focusing on the corporate business segment into a bank providing a comprehensive range of services across multiple channels. After the merger of ABN and AMRO worldwide, the bank started expanding in a big way in India, 991 onwards. The Delhi branch was set up in the very same year and ABN AMRO was launched in other Indian cities between 1994 and 1999. Anticipating the emergence of retail banking in India, the bank acquired the retail business of the Bank of America in 1999. Currently ABN AMRO has 16 branches across 11 cities. The Bank had a total income of US$ 248.1 million in 2003-04 and employed about 1,400 people. ABN AMRO Bank has a strong focus on the consumer and commercial clients business in India and it currently offers a wide range of assets (auto loans, personal loans, loans against securities), liability (current, savings accounts and term deposits) and investment products (mutual funds) to its customers. One of the largest foreign banks in India ABN AMRO has emerged as one of the most profitable banks and one of the largest foreign banks in India (in terms of Total assets in 2002-03). Net profits of ABN AMRO (India) have grown at a CAGR of 30 per cent since 1999-2000. Its non-performing assets were amongst the lowest in the industry at 0.88 per cent. ABN AMRO was awarded the Best Indian Bank in the Business Today-KPMG Best Banks Survey 2002. ABN AMRO ranks 2nd in terms of Business per branch and 2nd in terms of Operating profit per branch. Factors for success ABN AMRO has used technology as the key differentiator to gain competitive advantage and create a unique customer value proposition. ABN AMRO has been successful in India owing to its customer- FORTUNE 500 COMPANIES IN INDIA PAGE 28 Retail strategy The retail assets of Indian banks grew at a CAGR of 25 per cent in the last 3 years (The growth was 35% last year). With its strategic acquisition of the retail portfolio of Bank of America, ABN AMRO had positioned itself effectively to leverage on this boom. The Bank’s emphasis on technology has helped it in its aggressive retail banking initiatives that require high transactions processing capability and computing power. Exemplary customer service: The relationship approach ABN AMRO believes in taking the bank to the customer. Continuing with this philosophy, it launched Doorstep banking, where cash and Demand Drafts are delivered at, and cheques picked up from the customer‘s doorstep. centric banking approach. By anticipating the needs of customers in advance and launching innovative products, the bank has been able to cash on the retail boom in the country. ABN AMRO has tied up with various financial services institutions (like insurance companies) in order to provide a whole gamut of financial solutions to its customers. Pioneer in adopting technology The implementation of a robust core banking solution in 2001 enabled ABN AMRO India to offer 24/7 integrated multi-channel banking and to be the first bank in India to realise the potential of the mobile channel. The bank launched NetBanking, its e-banking solution, in 2002. It is amongst the best in the country, with advanced transaction and enquiry facilities including Cyber Receipts and Short Messaging Service (SMS) mobile alerts. In order to take advantage of the booming cellular base of India, ABN AMRO has launched Mpower, a comprehensive mobile banking platform. SUCCESS STORIES PAGE 29 In 2001, ABN AMRO developed Van Gogh Preferred Leveraging the India Advantage Banking (VGPB). VGPB is a relationship banking ABN AMRO has been leveraging India for back-office approach for high net worth customers, professionals and software development operations: and business owners. A dedicated Relationship Manager, whose focus is to anticipate and provide Off-shoring business processes for the client’s every financial need, gives VGPB Leveraging India’s large pool of highly talented and customers personalised service. English-speaking workforce, ABN AMRO has In order to ensure a pan India reach for customers, outsourced business processes from about 18 ABN AMRO tied up with UTI Bank for sharing its countries to its back-offices in Chennai, Mumbai and ATM networks. This has also helped ABN AMRO Delhi. The headcount in these centres is about 1,200. minimise capital expenditure required for an extensive ABN Amro has found that off-shoring business ATM network. processes to India is paying off, not only in terms of cost reduction and quality enhancement, but also in One stop shop for financial services needs of enabling it to scale up its business across the globe. customers Apart from its focus on consumer and corporate Future plans banking activities, in order to provide a complete ABN AMRO Bank NV has identified India as a key range of financial solutions, ABN AMRO has tied up growth market for its business and has significant future with Aviva for life insurance needs of its customers. plans for India. It has tied up with ICICI Lombard General Insurance • ABN AMRO has recently given the India Company to launch ‘LoanProtect’, an insurance cover operations a “Home Bank” status , which signifies as an add-on facility on all its consumer loans (home, that India is one of the Top Three priority markets personal, as well as auto loans). The bank also offers for the Bank. Broking services, Depository participant services and • ABN AMRO Bank plans to invest US$ 1 billion in advice on investing in Mutual Funds to its customers. India for selective acquisitions. Besides acquisitions, With the Indian economy poised for robust growth the bank plans to spend the proposed amount to and offering abundant investment opportunities, ABN build its franchise and to enhance its brand name in the country. According to the bank’s roadmap, AMRO has launched a mutual fund in June 2004. it hopes to be in 100 Indian cities in the next few years, with an initial plan to expand to 30 cities. Low borrowing costs due to captive • The Bank also intends to focus on the organic liability base growth model and has applied to the Reserve ABN AMRO Bank has been successful in keeping Bank of India (the regulator for Indian Banks) for low borrowing costs by effectively packaging products converting its branch licence to that of a subsidiary. to suit individual customer ABN AMRO is the first foreign bank to apply for requirements. At 1.95 per subsidiary status to the regulator. cent in 2003-04, the bank • ABN AMRO plans to double the headcount of had amongst the lowest cost its Business Process Outsourcing (BPO) division of funds in the Indian banking to 2,400 employees by the end of the year. industry. The net interest margin of the bank was amongst the highest in the industry at 4.9 per cent. FORTUNE 500 COMPANIES IN INDIA PAGE 30 SUCCESS STORIES PAGE 31.