As global competition intensifies, domestic banks, be they commercial, private or cooperative, have been on their toes to satisfy the discerning and demanding consumers.

A study by the Boston Consulting Group titled “Searching for Profitable Growth, Global Wealth 2005” points out, “Standard banking services are under significant price pressure and wealth management institutions are moving towards less visible pricing. Offering proactive tailor made advice remains a high-margin activity.”

And that’s exactly what banks are doing too.

Cross border flows and introduction of new financial products have not only led to a spurt in the growth of the economy but have also altered the traditional roles played by banks.

As Sanjay Nayar, CEO of Citigroup India once explained, "Consumer banking and corporate banking contributed equally to the total revenues, but about 70 percent of the profits came from corporate business, which included investment banking activities and capital markets."

Naturally, due to this new avtar that banks have donned, the attitude of corporate clients towards banks has changed too.

As Kannan, Managing Director of Franch Express Network Private Ltd. (associate concern of AFL Ltd.) states, "No longer do we consider our bank as a place to stash some excess cash or beg for loans. It is our friend, philosopher and guide. Whether it is merger planning advice, market timing decisions or a product diversification question, we turn to our bank for help and guidance."

Mr. Divya Aggarwal

Money Management Consultants Ltd

Senior Copy Editor, Money Management Consultants Ltd
New Delhi, India

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