GE plans to acquire bank in India
By agencies | Thursday, 24 March 2005, 08:00 Hrs
NEW DELHI: U.S. based diversified giant General Electric¬ís finance arm is planning to acquire a bank in India. The company is waiting for some clarification from the Reserve Bank of India on which banks will be available for acquisition. In particular, GE wants to know what is a weak bank and how will such banks be identified. It has to see what is the maximum equity it can get within the existing framework of rules. On March 2, GE Money, the consumer finance arm of GE, had said that GE Money is planning to roll out its retail banking operations in India within the next two years. An acquisition is expected to give GE Money a jump-start in the business, though it would come with its share of liabilities. The company has banks in many countries that fit in nicely with GE Money. Though GE is looking at the public sector as well as the private sector for the acquisition it may end up buying a private sector bank. GE is also eyeing orders from the Indian armed forces with defense co-operation between India and the US improving of late. Though GE sold its aerospace and defense businesses, it still makes engines used in fighter as well as transport aircraft. GE engines support Hindustan Aeronautics¬í light combat aircraft (LCA) project. The Indian government has shown its interest in purchasing a new fleet of aircraft. If the government selects Lockheed Martin's F16s, GE said it could result in very large business for GE as the government is expected to place orders for as many as 126 aircraft over a period of time. With the US putting nuclear power collaboration between the two countries on the table, GE could get into the sector by providing the technology, equipment and long-term service to any Indian entity planning to set up a nuclear power plant.