UBS Likely To Revive Its Bid For Stan Chart AMC

Mumbai: It seems no one is immune to the pressures of lobbying not even the staunchly independent Reserve Bank of India. Just months after the RBI rejected an application by Swiss bank UBS to acquire the asset management business of Standard Chartered Bank, UBS is now in a position to revive its bid for Stan Chart AMC after the RBI cleared its application for a full banking licence.

The RBI has allowed it to convert its representative office into a branch. For now UBS will be allowed to open one retail banking branch but henceforth, the Swiss bank will be allowed to apply to the RBI for more branches.While UBS declined to officially comment on the development sources indicate that UBS has received official communication from the RBI.

The RBI's volte-face on UBS has raised many questions about its failed bid for Standard Chartered AMC. The RBI had rejected that bid due to questions raised about certain transactions suspected of money laundering, which had led the RBI to say that UBS' proposal was not found to be fit and proper. However, sources say now that the RBI has cleared UBS's proposal for a full banking licence, the Swiss bank has sufficient grounds to re-open that bid. Following that exercise, UBS is likely to re-file its application for an Asset Management Business with SEBI and RBI.The change in UBS's fortunes in India comes a week after a high level delegation from the Swiss Bankers Association met with the RBI and finance ministry officials. The association has assured the RBI that Swiss Banks like UBS have stringent anti-money laundering systems in place and will comply with all rules and regulations set by the RBI. With those assurances in place UBS is now likely to be expand its presence in India substantially with a focus on retail operations.