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BNP Paribas to wield axe

Poornima Mohandas

MUMBAI, July 5

THE French Bank, BNP Paribas will retrench the remaining 60 employees in its Indian retail business by year-end. The bank had retrenched 80 in February following the decision to wind up its retail business.

"We are slowly phasing out the employees in our retail set-up. Some of them might be absorbed by the bank that will acquire our retail customer base," said a senior official at BNP Paribas.

The assets of the bank, which include personal and car loans, are also soon to be transferred to another bank. "We are in discussion with HSBC Bank regarding the modalities of the transfer of assets," said Mr Harshal Vora, Financial Controller, BNP Paribas.

Recently the liabilities of BNP Paribas had undergone the same process of transfer to HSBC Bank. Both the transfers awaited permission from the Reserve Bank of India for the changes to be in place, Mr Vora said. "Through this arrangement we are looking at the convenience for our customers. They are now being offered an option to transfer their accounts to HSBC Bank," he said. There was no monetary gain for BNP Paribas through this arrangement with HSBC Bank, he added.

The bank is also looking at leasing out the redundant floor space that was earlier utilised for retail activities. Though BNP Paribas was exiting the retail business, it was interested in taking stakes in Indian private banks, said the official.

The bank is to get fresh infusion of funds within the next six months, approximately Rs 25 crore from its parent in Paris for this year's restructuring activity.

"There will be more funds coming in as and when we need it, to support the CAR and to facilitate growth in 2003 and 2004. We might need fresh capital to acquire stake in other companies," said Mr Vora. This year Rs 99 crore capital was brought in from the head office to maintain the CAR at 9.7 per cent.

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