ING Vysya Bank
Encyclopedia
ING Vysya Bank is a Bangalore
-based retail and commercial bank, formed after the ING Group
formally merged with Vysya Bank in 2002. This merger marks the first between an Indian bank and a foreign bank.
, Karnataka
. The state of Karnataka
is known as the "cradle of Indian banking" due to the region's bygone banking relationship with several European East India Companies during the 17th, 18th and 19th centuries. Seven of the country's leading banks (Canara Bank
, Syndicate Bank
, Corporation Bank
, Vijaya Bank
, Karnataka Bank
, State Bank of Mysore
, and ING Vysya Bank) were originally established in Karnataka
.
From the 1930's through the 1950's, Vysya Bank built its banking business organically in southern India. The bank focused on serving the Vysya community, a merchant/trading community operating across Karnataka
and Andhra Pradesh
. In 1958, the bank was licensed by the Reserve Bank of India
(RBI) to expand its banking operations nationwide. In 1972, the RBI upgraded Vysya Bank to a national B class bank.
In 1987, Vysya Bank established two independently operating subsidiaries providing equipment leasing and home mortgaging services (Vysya Bank Leasing Ltd and Vysya Bank Housing Finance Ltd, respectively). In 1994, Vysya Bank began marketing several innovative financial products to the fast-growing Indian middle-class segment (e.g. Vysprime and Vysinvest for NRIs, Vysbuy for consumer financing, Vysmobile for auto loan financing, and Vysequity for common equity financing).
(BBL). Following this agreement, the Vysya Bank engaged KPMC Peat Marwick for assistance in re-engineering its business processes in preparation for globalization. In 1996, an international investment banking joint venture (JV) with MC Securities (London), an investment banking subsidiary of BBL, was formally established.
In 1998, the ING Group
acquired BBL and all its contractual and JV interests in Vysya Bank. In 1999, Vysya Bank joined the ING Group
in co-marketing/distribution of life insurance products in India. Vysya Bank also acquired a 26% equity stake in the ING Asset Management Company. In 2000, Vysya Bank, ING
Insurance, and the Damani Group formed a life insurance JV; this innovative collaboration marks the first bancassurance venture in India.
. Under Indian law, this move allowed ING to increase its total equity holdings in Vysya Bank from 20% to 44%. Peter Alexander Smyth and Jacques PM Kemp were appointed to the Board of the newly formed ING Vysya Bank.
ING Vysya Bank then appointed Bart Hellemans as CEO & Managing Director (MD) and G. Mallikarjuna Rao as Chairman of the Board.
, a leading global money transfer firm, tied up with ING Vysya for inbound money transfer services across India. ING Vysya then launched three new endowment products and an innovative retail savings account called Orange with facilities such as personal accident and free annual accident coverage. Japanese auto manufacturer Toyota then signed an agreement with ING Vysya for auto financing services. ING Vysya then inked a deal with fertilizer concern, Madras Fertiliser Ltd (MFL), to co-market/distribute life insurance products to farmers by employing the fertilizer company's broker-dealer network in the rural sector.
In 2005, ING Vysya Bank named Ned Swarup to the CEO & MD role. ING Vysya launched an innovative checking account product for mid-sized businesses. ING Vysya Bank also rolled out its own proprietary online money transfer service.
In 2006, Vaughn Richtor stepped into the CEO & MD role for a fixed three-year term. Under Mr. Richtor's leadership, ING Vysya went private and delisted from the Bangalore Stock Exchange. ING Vysya also forayed into private banking and portfolio management services.
In 2009, Shailendra Bhandari was appointed as CEO & MD of ING Vysya Bank. He was formerly the Head of Private Equity at Tata Capital, the Tata Group
’s private equity arm. Having completed his three-year term in India, Vaughn Richtor was promoted to CEO of ING Banking Asia.
In 2010, the Board of ING Vysya Bank nominated Mr. Arun Thiagarajan to succeed Mr. K.R. Ramamoorthy as Chairman of the Board. Mr. Thiagarajan was selected for his vast and diverse international experience across strategic planning, economics & finance, technology and systems.
Bangalore
Bengaluru , formerly called Bengaluru is the capital of the Indian state of Karnataka. Bangalore is nicknamed the Garden City and was once called a pensioner's paradise. Located on the Deccan Plateau in the south-eastern part of Karnataka, Bangalore is India's third most populous city and...
-based retail and commercial bank, formed after the ING Group
ING Group
The ING Group is a global financial institution offering retail banking, direct banking, commercial banking, investment banking, asset management, and insurance services. ING is the Dutch member of the Inter-Alpha Group of Banks, a cooperative consortium of 11 prominent European banks...
formally merged with Vysya Bank in 2002. This merger marks the first between an Indian bank and a foreign bank.
Early years
Founded in 1930, Vysya Bank was formally incorporated in the city of BangaloreBangalore
Bengaluru , formerly called Bengaluru is the capital of the Indian state of Karnataka. Bangalore is nicknamed the Garden City and was once called a pensioner's paradise. Located on the Deccan Plateau in the south-eastern part of Karnataka, Bangalore is India's third most populous city and...
, Karnataka
Karnataka
Karnataka , the land of the Kannadigas, is a state in South West India. It was created on 1 November 1956, with the passing of the States Reorganisation Act and this day is annually celebrated as Karnataka Rajyotsava...
. The state of Karnataka
Karnataka
Karnataka , the land of the Kannadigas, is a state in South West India. It was created on 1 November 1956, with the passing of the States Reorganisation Act and this day is annually celebrated as Karnataka Rajyotsava...
is known as the "cradle of Indian banking" due to the region's bygone banking relationship with several European East India Companies during the 17th, 18th and 19th centuries. Seven of the country's leading banks (Canara Bank
Canara Bank
Canara Bank is a state-owned financial services company in India. It was established in 1906, making it one of the oldest banks in the country. As on 2009 November, the bank had a network of 3057 branches, spread across India...
, Syndicate Bank
Syndicate Bank
Syndicate Bank Ltd. is one of the oldest and major commercial banks of India. At the time of its establishment, the bank was known as Canara Industrial and Banking Syndicate Limited. The bank, along with 13 major commercial banks of India, was nationalized on 19 July 1969, by the Government of...
, Corporation Bank
Corporation Bank
Corporation Bank is an India-based banking company based in Mangalore, India. The bank was founded with an initial capital of Rs. 5000 , and first day’s canvassed resources of less than one USD 1, has currently 12,724 full time employees, and operates from several branches in India.The Bank is a...
, Vijaya Bank
Vijaya Bank
-History:Vijaya Bank , a medium sized bank with presence across India. It was founded on October 23, 1931 by A. B. Shetty and a few other farmers in Mangalore, Karnataka in India.. The objective was to promote banking habits, thrift and entrepreneurship among the farming community of Dakshina...
, Karnataka Bank
Karnataka Bank
Karnataka Bank Limited is a private sector banking institution based in the town of Mangalore in Karnataka, India. The Reserve Bank of India has designated Karnataka Bank as an A1+-class scheduled commercial bank....
, State Bank of Mysore
State Bank of Mysore
State Bank of Mysore is a nationalised bank in India.State Bank of Mysore was established in the year 1913 as Bank of Mysore Ltd. under the patronage of the erstwhile Govt. of Mysore, at the instance of the banking committee headed by the great Engineer-Statesman, Late Dr. Sir M.Visweswaraiah...
, and ING Vysya Bank) were originally established in Karnataka
Karnataka
Karnataka , the land of the Kannadigas, is a state in South West India. It was created on 1 November 1956, with the passing of the States Reorganisation Act and this day is annually celebrated as Karnataka Rajyotsava...
.
From the 1930's through the 1950's, Vysya Bank built its banking business organically in southern India. The bank focused on serving the Vysya community, a merchant/trading community operating across Karnataka
Karnataka
Karnataka , the land of the Kannadigas, is a state in South West India. It was created on 1 November 1956, with the passing of the States Reorganisation Act and this day is annually celebrated as Karnataka Rajyotsava...
and Andhra Pradesh
Andhra Pradesh
Andhra Pradesh , is one of the 28 states of India, situated on the southeastern coast of India. It is India's fourth largest state by area and fifth largest by population. Its capital and largest city by population is Hyderabad.The total GDP of Andhra Pradesh is $100 billion and is ranked third...
. In 1958, the bank was licensed by the Reserve Bank of India
Reserve Bank of India
The Reserve Bank of India is the central banking institution of India and controls the monetary policy of the rupee as well as US$300.21 billion of currency reserves. The institution was established on 1 April 1935 during the British Raj in accordance with the provisions of the Reserve Bank of...
(RBI) to expand its banking operations nationwide. In 1972, the RBI upgraded Vysya Bank to a national B class bank.
In 1987, Vysya Bank established two independently operating subsidiaries providing equipment leasing and home mortgaging services (Vysya Bank Leasing Ltd and Vysya Bank Housing Finance Ltd, respectively). In 1994, Vysya Bank began marketing several innovative financial products to the fast-growing Indian middle-class segment (e.g. Vysprime and Vysinvest for NRIs, Vysbuy for consumer financing, Vysmobile for auto loan financing, and Vysequity for common equity financing).
Globalization through Europe
In 1995, Vysya Bank entered into a long-term strategic alliance with Belgian bank Bank Bruxelles LambertBank Bruxelles Lambert
Bank Bruxelles Lambert , part of the ING Group since 1998, was created in 1975 from the merger of Banque de Bruxelles and Banque Lambert. It was the second largest Belgian bank....
(BBL). Following this agreement, the Vysya Bank engaged KPMC Peat Marwick for assistance in re-engineering its business processes in preparation for globalization. In 1996, an international investment banking joint venture (JV) with MC Securities (London), an investment banking subsidiary of BBL, was formally established.
In 1998, the ING Group
ING Group
The ING Group is a global financial institution offering retail banking, direct banking, commercial banking, investment banking, asset management, and insurance services. ING is the Dutch member of the Inter-Alpha Group of Banks, a cooperative consortium of 11 prominent European banks...
acquired BBL and all its contractual and JV interests in Vysya Bank. In 1999, Vysya Bank joined the ING Group
ING Group
The ING Group is a global financial institution offering retail banking, direct banking, commercial banking, investment banking, asset management, and insurance services. ING is the Dutch member of the Inter-Alpha Group of Banks, a cooperative consortium of 11 prominent European banks...
in co-marketing/distribution of life insurance products in India. Vysya Bank also acquired a 26% equity stake in the ING Asset Management Company. In 2000, Vysya Bank, ING
Ing
-In English:* -ing, a suffix added to English verbs to make a present active participle or a gerund* Ing, a word for a water-meadow-In old Germanic history:* Ing, Ingui or Yngvi, a Germanic god* Ingaevones, a West Germanic cultural group...
Insurance, and the Damani Group formed a life insurance JV; this innovative collaboration marks the first bancassurance venture in India.
Formal merger with the ING Group
In 2002, Vysya Bank's Board of Directors and the RBI approved Vysya Bank's formal merger with the ING GroupING Group
The ING Group is a global financial institution offering retail banking, direct banking, commercial banking, investment banking, asset management, and insurance services. ING is the Dutch member of the Inter-Alpha Group of Banks, a cooperative consortium of 11 prominent European banks...
. Under Indian law, this move allowed ING to increase its total equity holdings in Vysya Bank from 20% to 44%. Peter Alexander Smyth and Jacques PM Kemp were appointed to the Board of the newly formed ING Vysya Bank.
ING Vysya Bank then appointed Bart Hellemans as CEO & Managing Director (MD) and G. Mallikarjuna Rao as Chairman of the Board.
Post-merger activities
In 2003, Western UnionWestern Union
The Western Union Company is a financial services and communications company based in the United States. Its North American headquarters is in Englewood, Colorado. Up until 2006, Western Union was the best-known U.S...
, a leading global money transfer firm, tied up with ING Vysya for inbound money transfer services across India. ING Vysya then launched three new endowment products and an innovative retail savings account called Orange with facilities such as personal accident and free annual accident coverage. Japanese auto manufacturer Toyota then signed an agreement with ING Vysya for auto financing services. ING Vysya then inked a deal with fertilizer concern, Madras Fertiliser Ltd (MFL), to co-market/distribute life insurance products to farmers by employing the fertilizer company's broker-dealer network in the rural sector.
In 2005, ING Vysya Bank named Ned Swarup to the CEO & MD role. ING Vysya launched an innovative checking account product for mid-sized businesses. ING Vysya Bank also rolled out its own proprietary online money transfer service.
In 2006, Vaughn Richtor stepped into the CEO & MD role for a fixed three-year term. Under Mr. Richtor's leadership, ING Vysya went private and delisted from the Bangalore Stock Exchange. ING Vysya also forayed into private banking and portfolio management services.
In 2009, Shailendra Bhandari was appointed as CEO & MD of ING Vysya Bank. He was formerly the Head of Private Equity at Tata Capital, the Tata Group
Tata Group
Tata Group is an Indian multinational conglomerate company headquartered in Mumbai, Maharashtra, India. Tata Group is one of the largest companies in India by market capitalization and revenue. It has interests in communications and information technology, engineering, materials, services, energy,...
’s private equity arm. Having completed his three-year term in India, Vaughn Richtor was promoted to CEO of ING Banking Asia.
In 2010, the Board of ING Vysya Bank nominated Mr. Arun Thiagarajan to succeed Mr. K.R. Ramamoorthy as Chairman of the Board. Mr. Thiagarajan was selected for his vast and diverse international experience across strategic planning, economics & finance, technology and systems.