Swiss Banks Walk Tightrope in India

Affluent vs Wealthy

Credit Suisse last week inaugurated a Pune site (pictured below) which will house some of its 14,000 employees in India. More than 1,500 of the 5,000 employees that Credit Suisse employs directly, as opposed to outside vendors, are in technology. Their jobs center around areas like big data and machine learning, the Swiss wealth manager said.

India is also producing science and tech graduates at a rate second only to China and four times that rate of the U.S, according to data from the World Economic Forum. That helps as banks upgrade big service centers from mundane tasks like call centers to far more complex questions like artificial intelligence.

(Swiss consult Othmar Hardegger, left, and Mihir Doshi, CEO of Credit Suisse in India)

Some, like Standard Chartered are attempting to parlay well-established Indian retail arms into more wealth – or at least affluent – banking. It remains to be seen whether this costly and arduous strategy will pan out. 

Eventual Wealth Push

Similarly, Singapore’s DBS last week put extra muscle into Indian consumer and corporate lending – a move which may foreshadow an eventual wealth push.

Further up the wealth spectrum, Deutsche Bank has translated its pipeline of corporate banking relationships into wealth business. Other, more successful foreign players like BNP and Citi, which together command roughly $20 billion of Indian wealth, have also used major investment banking activities as a wealth management door-opener.

«Innovation Business»

Big wealth players eschewing the wealth market isn’t without irony: their powerhouse operations in Bangalore, Pune, and Mumbai are employing highly-qualified science and technology graduates like mathematicians, statisticians, and physicists. In short, the global «insourcing» hubs are producing a swath of affluent potential clients.

The discrepancy is also emblematic of India’s hot-and-cold attitude to foreign wealth managers: regulators gave domestic players a huge advantage which made life harder for outsiders. But India has been nothing but welcome to the «innovation business», which to be sure doesn’t actually add to bank revenue.