ICICI Bank Captures 23Pc Of Derivatives Mart

Mumbai: ICICI Bank has made entry into the complex world of financial derivatives, which till not long ago was the exclusive domain of foreign banks. In about three years, the bank says it has captured a 23 per cent market share in the derivative business, helped by its relationships with Indian companies, which are growing their operations globally. As the bank tastes success in derivatives business, the country''s largest lender, State Bank of India (SBI), is taking the initial steps to acquire derivatives capabilities. Foreign banks had near monopoly in offering complex foreign exchange and interest rate derivative products to Indian companies, as they could also import any product required from their global experts. ICICI Bank has achieved quite a distance and SBI has made serious beginnings towards acquiring the necessary expertise for offering full range of derivatives products.

ICICI Bank said So far, banks like it had the capability in lending but they did not have access to the structured market business. Large part of the fee income comes from advisory, syndication, transaction banking fee, derivatives and others. They have set up a dedicated foreign exchange derivatives business team of 100 people. ICICI Bank''s trading volumes in currency derivatives increased by 70 per cent to Rs 73,093.16 crore in 2006-07 from a year earlier and in interest rate derivatives by 28 per cent to Rs 2,79,474.31 crore from a year earlier. The derivatives business is driven by volatility in the foreign exchange market. The bank has product experts that assist corporate bankers in helping companies understand various derivatives products, which would best suit their operations.