Japan's SMFG Ventures Into India
The Japanese financial group has a deal for a 74.9 percent stake in Fullerton India for $2 billion, marking the first entry into the South Asian country’s retail financial business by a Japanese bank.
With the investment, Sumitomo Mitsui Financial Group (SMFG) will gain a retail finance platform in India, which is «essential for the expansion of its Asia franchise,» the firm said in an announcement on Tuesday.
Fullerton India has a strong pan-India distribution network of 650 branches and offers unsecured loans and loans against property to SMEs, the self-employed and mass market customers. It owns different brands for each demographic it serves: Urban, Rural, Digital and Housing Finance.
New Growth Opportunities
According to SMFG's medium-term management plan, the firm aims to increase profits by optimizing and remodeling its businesses, while pursuing new growth opportunities.
Fullerton Financial, parent of the Indian non-bank firm, is a unit of Singapore state investment fund Temasek Holdings. SMFG, Japan's second-largest lender, will eventually acquire the rest of the Indian credit firm from Fullerton Financial Holdings at a later stage, the announcement said.
SMFG in April agreed to buy a 49 percent stake in Vietnamese consumer lender FE Credit. Last month, the bank acquired a 4.99 percent stake in Philippines' Rizal Commercial Banking Corp. for 4.48 billion pesos ($91 million).
