Goa, Aug 16: The Indian arm of French bank BNP Paribas SA will receive $45 million in capital investment from its Paris-based parent to expand its asset base, a senior bank executive said. BNP Paribas approved the investment earlier this week, Ravi Chikhlikar, chief general manager and head of fixed income and treasury of its Indian operations, said on Friday on the sidelines of a seminar on the foreign exchange market. The Indian unit will receive $30 million by way of an equity investment and the remaining $15 million as subordinated debt that will mature in at least 10 years.
"We will draw down the funds as and when required. We plan to bring in $5-$10 million immediately," Chikhlikar said without specifying an exact date.
The Indian unit has capital of Rs 3 billion ($65.4 million), of which around $15 million is in the form of subordinated debt, he added.
Chikhlikar said the Indian operation was looking to expand its asset base by stepping up lending to top-rated companies and by increasing its investments in fixed income markets, including derivatives.
He said that the bank's ratio of capital to risk-weighted-assets was more than nine percent, but the capital infusion would not hike it because of the expanded asset base.
Last week, the Indian parliament introduced a bill which proposes to increase the minimum capital level for foreign banks to one billion rupees ($21.8 million). Bureau Report