British lender Standard Chartered is negotiating with US investment bank Morgan Stanley to acquire its Indian private wealth management unit, in a bid to boost its local footprint.
StanChart, which re-entered the private banking business in 2006, is likely to emerge as the potential buyer of the Indian unit, which manages approximately $1bn, including loans.
It is expected that the US lender will start the bidding process soon and plans to raise nearly $100m from the sale of the unit, which concentrates on high net worth individuals (HNI) and other wealthy clients.
After a strategic review of the division, Morgan Stanley sought to divest its Indian wealth management operation in November last year.
India wealth management market is highly split and competitive and global firms find it difficult to cope with increasing operational costs, while maintaining profitability.
Having introduced its wealth management business in India in 2007, StanChart has also a strong foothold in corporate and retail banking in the country.
Additionally, L&T Finance Holdings in India is also expected to bid for Morgan Stanley’s Indian wealth management business.