January 15, 2010
AfrAsia Bank has become the first domestic bank in Mauritius to obtain the Foreign Institutional Investor (FII) license from the Securities & Exchange Board of India (SEBI). This will enable the bank to provide a complete bouquet of service to its global business clients and facilitate their investments into Indian stocks and debt market using the sub-account route of FII. Presently only a few major international banks and also a few asset management companies provide this facility in Mauritius. AfrAsia Bank continues to efficiently execute its boutique banking focus for its corporate and institutional clients with a carefully selected and targeted range of customized products, services and delivery channels.
An FII is an institution established or incorporated outside India, which proposes to make investments in securities in India and regulated under the strict provisions of the SEBI. Sub-Account on the other hand means “any person resident outside India, on whose behalf investments are proposed to be made in India by a FII and who is registered as a sub-account under these regulations.” A foreign investor who does not wish to go through the full administrative hassle of applying and registering as an FII, may invest in India as a sub-account. This route has become one of the most utilised by investors to access the Indian market. It includes foreign corporates, foreign individuals and institutions, sovereign wealth funds, funds or portfolios established or incorporated outside India. There are less disclosure requirements and simpler documentation in the case of sub-account. Only one form is required to be completed, unless SEBI asks for constitutive documents. Moreover, it is the FII which applies to SEBI for sub-account registration. Eligibility criteria for sub-account registration are less stringent as compared to FII registration. Hence, the funds / entities which are not eligible for FII registration can be registered as sub-accounts, provided they are eligible for sub-account registration. For example, a fund that has been recently set up can invest in India as a sub-account of an FII although it cannot be registered as an FII.
“We are very pleased to have received SEBI’s approval and license. The Banking Industry is amongst the fastest growing sectors in the country and International business presents an interesting opportunity.” said James Benoit, AfrAsia Bank CEO. “It is not yet a crowded investment market here and we think that there is great merit in delivering solutions rather than just launch products. It is this investor centric approach built on customer oriented communication, long term relationships and enduring wealth creation that will seek to differentiate AfrAsia Bank. This is an important step in our strategy to tap the Indian market.” reiterated Mr James Benoit.
AfrAsia Bank has also entered into a strategic tie up with leading ICICI Bank for providing custodial services in India to its clients. AfrAsia’s relationship with the largest private sector bank of India has grown in strength in recent months. To provide most professional and seamless service to clients at most competitive margin, AfrAsia has also put in place various relationships with some of the most reputed and efficient broking houses based in Mumbai. The Bank is now fast developing capabilities for other value added services related to this activity, which will come with personalized services for which the Bank has already carved a niche for itself.