JP Morgan has come out virtually unscathed from the global financial meltdown. In India too, the bank has grown its business rapidly cashing in on its strengths in the investment banking space. The bank was among the biggest arrangers of money for Indian corporates last year. Going ahead it plans to focus on the mass affluent for its private and wealth management business and also continue to cater to companies with a suite of services. Speaking to FE?s Mahalakshmi Hariharan, Kalpana Morparia, CEO at JP Morgan India, explains that JP Morgan intends to remain within its niche rather than try to compete with bigger retail-focused banks.

Will JP Morgan stay with the businesses that it is already into or will you be exploring new areas?

We run three businesses in India, namely, investment banking, treasury securities and services and asset management. Overseas, JP Morgan actually runs six lines of businesses, the ones in the US that we don?t have here are the retail financial services, deposits, branch banking, auto and mortgages, a separate line of credit cards and mid-market commercial bank. We don?t intend to start these in India. We provide companies with cash management services, trade finance and custody services and of course we do investment banking, helping companies raise debt and equity. And there?s the broking business.

Is there adequate capital to grow the business?

Today, we are a fully-fledged bank in India with a branch licence and we can accept deposits. We also tend to get a lot of deposits that are placed with us in the context of our custody and broking business and we have an inward flow of capital coming from the parent company as we are a branch here. So there is enough capital to grow the business. We are focussing more on fee income rather than interest income.

What does your clientele look like?

We cater to multi-national corporations (MNCs) operating in India, there are several large companies that have their subsidiaries here, we would be the typical banker that would cover them. We also cater for Indian companies that are increasingly globalising. The third set of clients are what I call ?local local?, there may not be a big cross border angle to it but we would cover them and give them transaction banking and credit. On the market side, we also cover funds that are dedicated to investing in India, and emerging markets and also global funds who can invest into India but don?t necessarily have a dedicated vehicle to access notes or eventually a registration with Sebi.

JP Morgan has been talking of starting private banking in India…what is happening on that front?

This is something which is on the horizon and we hope to start this either by the close of this calendar year or next year.

Are you looking at a branch expansion strategy? Have you applied to the RBI?

We have applied to RBI but that is only to get a few niche branches to service our clients better. We are not here to compete with local a player…that?s not our strategy. So we don?t really need too many branches, just a few perhaps. We believe that there is a unique niche that we can bring in here and clients will value us for that. We are sometimes viewed as a banker?s bank because if you look at our transaction banking business, a large proportion of our clients are banks. We work with a lot of dollar clearing accounts with most of the Indian banks here and are happy to provide them with liquidity and credit.

The asset management business hasn?t taken off…

Well, the market in India is such that if you look at the top five players?Reliance, HDFC Standard Life, ICICI Prudential, UTI, and Birla Sunlife?they are all local houses. It is a ?local local? game. Fidelity and Templeton are dominant mutual funds across the globe, they are bigger than us, but they are not as big here. Our niche will be to help Indians invest overseas. Indians today want to diversify their portfolio, they don’t want to put all their eggs in one basket, even though there may be plenty of opportunities locally. We will grow the business but we will work with few partners and build franchise.