Foreign banks expanded their branch network and employee base in India marginally whereas overseas staff strength and number of branches of Indian banks and their subsidiaries recorded a decline during 2020-21, as per a Reserve Bank of India (RBI) survey.
According to the RBI, the number of foreign branches of Indian banks declined from 137 in 2019-20 to 121 in 2020-21 and foreign subsidiaries fell from 381 to 377. The decline coincided with the Covid-19 pandemic which hit most parts of the world in 2020.
While credit extended by foreign branches of Indian banks fell from Rs 7,34,663 crore to Rs 6,84,808 crore in FY21, deposits fell from Rs 4,25,994 crore to Rs 3,98,630 crore. Deposits of subsidiaries of Indian banks also fell from Rs 1,12,117 crore to Rs 1,08,969 crore in 2020-21.
he number of employees in overseas branches was down from 3,329 to 3,164 in 2020-21 and overseas subsidiaries from 5,762 to 4,943, the RBI survey said. The central bank said the total income of foreign branches of Indian banks declined from Rs 48,891 crore in FY20 to Rs 29,494 crore in FY21.
However, Indian branches of foreign banks mobilised a rise in deposits at Rs 7,58,361 crore in FY21, against Rs 6,84,289 last year. The number of branches of foreign banks here too went up from 306 to 311 during the year, and the employee strength from 23,548 to 23,930, according to the RBI.
The consolidated balance sheet of overseas branches of Indian banks rose despite outflow of deposits and fall in credit in FY21, indicating a larger role of borrowing and investment portfolios in business expansion.