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Former RBI governor YV Reddy had once grieved about global financial conglomerates being larger and more powerful than some of the central banks. 
 
However, in today’s scenario, this is not the exact case since these financial conglomerates are no longer on their way of overpowering India’s central bank. While it’s true that these global banks have enjoyed huge profits in India over the last 15 years, one can’t deny the fact that the market share of these banks is slowly sliding downwards. 
 
In 2005, foreign banks' share of advances was 6.55%, which dropped to 4.65% in 2010 and to 4.41% in 2015. It was in January that the UK-based Barclays shut down its equity capital market and broking business in India, after a continuous trend of full or part exit of foreign banks since 2009. 
 
A look at the business trends of these global firms in India in the last five years tells us that Deutsche Bank has sold its credit card business, Barclays has shut its retail banking business, Swiss lender UBS and US-based Morgan Stanley and Goldman Sachs have given up their banking licences, Bank of America-Merrill Lynch have sold its wealth management business to Julius Baer and Dutch banking group ING has sold its Indian operations to India-based Kotak Mahindra Bank. 
 
Last year too saw Royal Bank of Scotland, which had in 2013 shut 23 of its 31 branches in India, commenting that it will no longer continue its Indian operations. Similarly, HSBC said that it will shut down its private banking business in India. 
 
Now that it is clear that all these global firms are following what can be called a trend, let’s have a look at the reason. Indian economy is growing fast, which has forced multinational foreign banks to retreat into their domestic markets and protect their profitability. As per industry experts, it also means that global banking is near its demise. 
 
 
"Big is not beautiful anymore in banking. People can tell me whatever they want but this global, anywhere, anytime model for banking is not possible or valuable anymore," Boris Collardi, CEO at Swiss private bank Julius Baer, told ET in an interview. Collardi added that Julius Baer had seen the signs of this change early, which is why it shed its asset management and corporate investment bank businesses, so that it can solely focus on wealth management in the last 15 years. 
 
"There has been a tectonic shift in global banking post the crisis. Big, bulge-bracket banks have had to remodel themselves. The diminishing return of large global banks does not justify their presence in India. The banking model has changed to a home country one," Rana Kapoor, MD at Yes Bank, said. 
 
Not only this, Indian private sector banks are now being valued higher than their global counterparts, an example of which is HDFC Bank, which overtook European banks like Deutsche, Credit Suisse and Societe Generale in market capitalisation this year. 
 
<a href="http://s1.reutersmedia.net/resources/r/?m=02&amp;d=20120925&amp;t=2&amp;i=656697139&amp;w=644&amp;fh=&amp;fw=&amp;ll=&amp;pl=&amp;sq=&amp;r=CDEE88O14NN00">Image source</a>

Multinational global banks? No thanks, says India

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image">Getty Images/ Mark WilsonJamie Dimon, CEO of JPMorgan.</div></div></div>JPMorgan CEO Jamie Dimon doubled down on his anti-bitcoin position, calling cryptocurrencies like bitcoin a 'kind of novelty.'While talking to <a href="http://www.cityam.com/272451/jamie-dimon-faces-market-abuse-report-after-his-comments/amp">CNBC India</a> on Friday, the billionaire banker said the recent proliferation of initial coin offerings, a red-hot cryptocurrency-based fundraising method, and digital coins like bitcoin was concerning."It's creating something out of nothing that to me is worth nothing," Dimon said. "It will end badly."To raise money through an ICO, companies create their own digital coin or token. Investors have poured into ICOs this year with some companies raising millions of dollars in a matter of seconds from token sales. Friday marked the second time this month Dimon has publicly bashed bitcoin and digital currencies. At the Barclays Financial Services Conference on September 12, <a href="http://www.businessinsider.com/bitcoin-price-worse-than-tulip-bulbs-2017-9">Dimon called bitcoin a 'fraud' that would eventually blow up</a>.Dimon said Friday he thought governments would impede further growth of digital coins. According to Dimon, currencies need government backing. "Right now these crypto things are kind of a novelty." Dimon said. "People think they're kind of neat. But the bigger they get, the more governments are going to close them down." Chinese regulators, already, are moving forward to <a href="http://www.businessinsider.com/bitcoin-price-is-stable-and-traders-in-china-respond-to-crackdown-2017-9">shut down bitcoin trading in the country</a>. Aaron Lasher, the chief marketing office at Breadwallet, a bitcoin technology company, told Business Insider that Dimon's comments don't surprise him because digital currencies are a direct attack on his business. "Every dollar in cryptocurrency is another dollar in value that JPMorgan cannot monetize," Lasher said. "What does it mean when a software company 'manages' as much money as a traditional bank?"Blockswater, a Swedish algo-based liquidity provider, has <a href="http://www.cityam.com/272451/jamie-dimon-faces-market-abuse-report-after-his-comments/amp">filed a formal complaint to regulators against Dimon</a>, claiming his comments on September 12 are tantamount to spreading "false and misleading information" about cryptocurrencies, according to<a href="http://www.cityam.com/272451/jamie-dimon-faces-market-abuse-report-after-his-comments/amp"> reporting by City AM</a>.JPMorgan spokesman Brian Marchiony declined to comment. As for bitcoin, the digital coin was trading down more than 1% Friday morning at $3,575 per coin.<div class="KonaFilter image-container display-table"><div><div class="image on-image">MI</div></div></div>Get the latest Bitcoin price<a href="http://markets.businessinsider.com/currencies/BTC-USD"> here.</a> <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/robert-shiller-bitcoin-bubble-example-market-today-2017-9">Shiller says bitcoin is the best example of a bubble in the market today</a></h3> <div> </div> </div>

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Multinational global banks? No thanks, says India

BI India Bureau

Jamie Dimon bashes bitcoin again, says cryptocurrencies 'are kind of a novelty'

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