Spain-based BBVA (Banco Bilbao Vizcaya Argentaria) plans a major play in Indian financial sector. The bank has entered the domestic retail banking sector by signing a memorandum of understanding (MoU) with Bank of Baroda to form a joint-venture credit card business and has plans to tap opportunities in the financial sector. The Spanish bank had a market capitalisation of €37 billion (R2,23,000 crore) as on September 2010.
“The MoU show long-term commitment to the Indian market and is the first step to set up as significant business in India,” said Joiel Akilan, chief representative of BBVA in India.
The agreement between both entities will allow BBVA to acquire a 51% stake in the existing credit card subsidiary of Bank of Baroda, Bobcards for which the Spanish bank will make payment of R200 crore.
Once the bank stabilises in card business, the bank has plans to enter in another vertical of financial services such as asset management and non bank finance company (NBFC). “Bank may look at the other opportunities in the financial sector in the future considering the vast un-banked population in India,” said Akilan.