Best bank: ICICI Bank
As India’s second-largest private bank, ICICI Bank has once again demonstrated its ability to outperform its peers. While its formidable competitor, HDFC Bank, has a significant acquisition to digest, ICICI Bank has seized the opportunity to catch up in valuation and surpass market expectations, making it India’s best bank this year.
For the financial year ending March 31, 2024, ICICI Bank’s profits after tax grew by 28% year on year, reaching a remarkable $4.9 billion. The bank’s total deposits also witnessed substantial growth, increasing by 20% to $169.4 billion.
One of the key factors contributing to ICICI Bank’s success is the sustained improvement in its asset quality. The bank’s net non-performing asset ratio improved to 0.42% by the end of March, down from 0.48% 12 months earlier.
Despite the rising deposit costs that put pressure on net interest margins, ICICI Bank managed to maintain a high 4.53% margin for the financial year 2023/2024. For a bank of ICICI’s size and loan book diversity, maintaining a net interest margin above 4% is impressive and has been a key driver behind the bank’s rerating since 2020.
ICICI Bank’s commitment to leveraging technology and providing innovative solutions is also impressive. The bank’s retail lending platform, iLens, is continually upgraded, with personal loans and education loans now integrated alongside mortgages. In the last financial year, an impressive 71% of trade transactions were conducted digitally, while the volume of transactions processed through the Trade Online platform grew by a remarkable 29.2% year on year.
Best investment bank: Axis Capital
Axis Capital had a busy 2023, completing 74 transactions and averaging more than one transaction per week. The firm acted on some of the most significant deals in India over the review period and is India’s best investment bank this year.
The bank was especially active in the equity capital markets, where it executed 15 IPOs, 18 follow-ons, one ECM advisory mandate and five pre-IPOs.
One significant mandate saw it execute Data Infrastructure’s Rs51.9 billion ($620 million) combined offer for sale (OFS) and open market sale transaction. This deal marked India’s first-ever OFS in a privately listed infrastructure investment trust and the country’s second-largest secondary trade in such a vehicle. The transaction required complex regulatory amendments, which the bank completed in consultation with the Securities and Exchange Board of India.
In a landmark IPO mandate, Axis Capital facilitated JSW Infrastructure’s Rs28 billion offering. This deal represented the largest IPO by the group in 13 years and was more than 39-times oversubscribed. The bank also advised on Mankind Pharma’s IPO – the largest IPO of 2023 and the second-largest pharma IPO in Indian capital markets history. This offering received around 420,000 applications and was Rs477 billion oversubscribed.
Axis Capital also excelled in M&A advisory where it completed seven deals. In its most significant advisory role over the awards period, the investment bank facilitated ABFRL’s majority stake acquisition in and subsequent merger with TCNS. The deal had a novel transaction structure involving an acquisition of a controlling stake, a conditional open offer, promoter reclassification and a merger between two listed companies.
Best international bank: HSBC
HSBC had a good year in India in 2023, with profits up by 19% to $1.51 billion, from $1.27 billion the previous year.
A key focus has been the digitization of trade finance. The bank introduced a cross-border supply chain finance solution, automating early payments to overseas suppliers. Additionally, HSBC launched e-bank guarantee services for corporates and small and medium-sized enterprises, replacing traditional paper-based processes and reducing transaction cycles from two to three days to just minutes.
HSBC continues to prioritize support for India’s SME sector, expanding its funding initiatives for startups after allocating 80% of the earmarked $250 million from the previous year. Currently, the bank supports over 2,500 startups, including half of India’s top-100 unicorns. Collaboration with UK Export Finance resulted in the establishment of a £100 million financing program to further bolster SME financing in India.
These initiatives contributed to a robust increase in new customer acquisitions in 2023, with a 19% rise in corporate clients and a 26% increase in SME clients.
HSBC also facilitated sustainable finance amounting to $3 billion. The bank extended over $1 billion in social loans, supporting initiatives aimed at social impact, including employment generation and enhanced access to education in 2023. HSBC also participated in green bonds raised by renewable energy companies including Renew and Continuum.
Best international investment bank: Citi
Competition for the award for India’s best international investment bank was intense, but Citi secures it in recognition of its creative solutions and strong performance across multiple asset classes.
Led by head of India investment banking Rahul Saraf, Citi remains the top IPO and block trade house in India, executing 16 transactions worth $4.4 billion; and solidifying its position as an innovator through unique advisory services like the A shares cancellation by Tata Motors.
In a challenging market, Citi served as bookrunner on several marquee transactions, including the largest qualified institutional placement in over two years for Bajaj Finance and Tata Technologies’ IPO, which garnered the highest retail oversubscription.
Citi’s debt capital markets platform demonstrated strong capabilities across various products, executing the largest sustainable tranche issued by an investment grade Indian issuer – a $1 billion sustainability bond for EXIM Bank – and a $3 billion syndicated loan for Reliance Group, the largest ever from India.
In the M&A space, Citi and Goldman Sachs are neck and neck, with Citi completing 6 deals worth $92 billion and Goldman Sachs closing 18 deals totaling $101 billion. Citi advised on several landmark transactions, including the $60.8 billion merger of HDFC Bank with HDFC – the largest in India’s corporate history; the $6 billion green ammonia platform deal between AM Green and Gentari – the largest such deal globally; and the $600 million stake sale in IDFC Asset Management – India’s largest asset management buyout.
Best digital bank: Axis Bank
Axis Bank made progress in digital banking with the launch of NEO for Business and Open by Axis Bank in 2023, achieving impressive growth figures throughout the year.
NEO for Business is a dedicated transaction banking platform tailored to Indian small and medium-sized enterprises. It offers a range of features including digital self-onboarding, bulk payments, goods and services tax-compliant invoicing, payment gateway integration and end-to-end transaction tracking. The platform saw over 60,000 customer registrations in the last two quarters of 2023.
Open by Axis Bank serves as a comprehensive digital banking solution, providing access to over 250 banking services. Launched in 2023, it quickly won a large user base, with approximately 13 million monthly active users, including nearly 8.4 million non-Axis Bank customers.
Axis Bank has also introduced digital US dollar fixed deposits tailored for non-resident Indian customers at the IFSC Banking Unit in GIFT City, Gujarat, marking a significant advance in offshore banking services.
Additionally, the bank embraced artificial intelligence with the rollout of Microsoft Copilot across select user bases and a generative AI-based chatbot serving around 60,000 users across its branches. These AI-driven solutions enhance service efficiency and customer experience, positioning Axis Bank at the forefront of technological innovation in the banking sector.
Best bank for SMEs: HDFC Bank
Year-on-year growth in micro, small and medium-sized enterprise lending of 29% in 2023 underscores HDFC Bank’s robust expansion in this segment. Furthermore, the bank’s market share increased from 16.46% in March 2022 to 18.32% by February 2024.
A notable initiative launched in 2023 was the introduction of four new credit cards specifically designed for small and medium-sized enterprises. These cards offer unique benefits, including 55 days of interest-free credit.
Recognizing the critical issue of limited access to finance for SMEs in India, HDFC Bank rolled out several targeted programmes. These included a collateral-free credit guarantee programme, providing up to Rs100 million ($1.2 million) for Indian startups. Additionally, the GST Surrogate programme streamlined the lending process by allowing applicants to apply for working capital facilities based on their goods and services tax reports, thereby enhancing accessibility and efficiency.
Digital innovation has also been a cornerstone of HDFC Bank’s strategy to empower SMEs. The bank launched a unified digital platform tailored to meet the payable and receivable needs of businesses. This platform integrates functionalities for vendor payments, utility bills and statutory payments, offering SMEs enhanced cash flow management capabilities and operational efficiency.
Best bank for ESG: IndusInd Bank
IndusInd Bank’s commitment to sustainable development is underscored by compelling data reflecting its impact in 2023. Sustainable finance now constitutes approximately 46% of the bank’s total lending, up from 43% in 2022 and a significant rise from 33% in 2018. In 2023, the bank’s green and climate finance advances amounted to Rs78.8 billion ($944 million), representing 2.72% of its total loans.
To advance India’s net-zero goals, IndusInd Bank has introduced a comprehensive suite of environmental, social and governance-linked financing solutions aimed at mobilizing corporate support. A prime example is its role as the lead underwriter and lending institution for a Rs10 billion project finance facility for NLC India’s 300-megawatt solar project. This initiative is projected to annually generate approximately 750,000 megawatt hours of solar energy and mitigate an estimated 690,000 tonnes of CO₂ emissions upon completion.
In addition to its focus on renewable energy, the bank has embarked on underwriting project finance deals in the burgeoning electric vehicle sector, sanctioning over Rs4 billion in loans to corporates in this industry.
IndusInd Bank has also launched Indus Solar, a new financing product designed to provide rooftop solar loans to small and medium-sized enterprise clients. This initiative aims to help SMEs reduce energy expenses, thereby enhancing profitability and sustainability.
Highlighting its global engagement, IndusInd Bank participated in Global Canopy’s Taskforce on Nature-related Financial Disclosures pilot programme in India. This initiative focused on assessing the bank’s corporate agricultural portfolio against two key parameters, biodiversity and water scarcity. By integrating insights from this assessment, the bank aims to incorporate nature-related risks into its lending decisions.
Best bank for corporate responsibility: BNP Paribas
BNP Paribas has implemented various corporate social responsibility projects aimed at empowering girls and women from diverse backgrounds across India. These initiatives range from advocating for girls’ rights in Uttarakhand to supporting female students in Karnataka and housewives in Madurai, Tamil Nadu. In total, the bank has launched over five projects, benefiting a total of 43,000 women.
Girls’ education has been a priority for BNP Paribas India, which has partnered with several NGOs to empower young women. In 2023, the bank collaborated with local foundations to train over 300 female engineering students from marginalized backgrounds. Many of these students, aged between 18 and 25 years, have successfully secured placements in leading companies.
Since 2020, BNP Paribas has sponsored the education of 500 economically disadvantaged girls at Avasara Academy, a residential secondary school for girls aged 12 to 18 years. Through initiatives like the Room to Read Girls Education Programme, the bank has supported over 25,000 girls in India since 2016.
In partnership with Industree, BNP Paribas has also launched the Promoting Resilience of Gender through Rural Entrepreneurship project. This initiative aims to create green and sustainable livelihoods for rural women, particularly among socially and economically marginalized tribal communities. The project has benefitted 1,300 women, providing them with opportunities for inclusion and fostering sustainable economic growth.
BNP Paribas also emphasizes employee engagement in volunteering activities. In 2023, employees in India collectively volunteered for over 50,000 hours, marking a 22% increase from the previous year. Activities included volunteering with children undergoing cancer treatment, conducting educational sessions on renewable energy for students, and participating in tree planting drives.
Best bank for diversity and inclusion: DBS
DBS has launched a series of initiatives aimed at enhancing diversity among its workforce in India, particularly focusing on female employees. Firstly, the bank revamped its hiring strategy to attract talent from diverse geographic locations and academic backgrounds. In 2023, DBS recruited approximately 150 graduates from various campuses, 48% of them women.
The RefHer programme incentivizes employees to refer qualified female candidates from their networks for open positions at DBS. During International Women’s Day and peak hiring periods, the standard referral bonus is doubled, resulting in 40% of women being hired through referrals in 2023. Additionally, DBS introduced initiatives to support women returning from career breaks.
These initiatives have proven effective. From 2021 to 2023, DBS steadily increased its diversity representation from over 27% to the current 30%, with a target to reach 35% within the next three years, showcasing DBS’s commitment to gender diversity.
Beyond internal initiatives, DBS Bank India has extended its support to the community through partnerships. The bank collaborated with Haqdarshak Empowerment Solutions to implement a social protection and financial literacy programme targeting marginalized citizens across India. This initiative has positively impacted 88,600 beneficiaries, with women constituting 95% of the total.
Best bank for corporates: Kotak Mahindra Bank
For its range and quality of corporate banking services, investment in digital, and financial performance, Kotak Mahindra Bank wins the award of India’s best bank for corporates this year.
Together with providing corporate clients with cash-management services and trade and supply-chain finance, the bank also offers one of the most comprehensive ranges of other specialist banking services, from custody to infrastructure and project financing, to real estate.
These capabilities are supported by the bank’s investment banking strengths, especially in financial advisory, equity and debt capital markets.
Kotak covers corporates across sectors and sizes, but specialises in banking multinationals and new digital companies, one of the fastest-growing segments of the Indian economy.
Keeping pace with this growth in digital investment, last year the bank further invested in the development of its Kotak fyn digital platform, which provides corporate clients with a range of online services including account management, trade facilitation, collections, and loans and payments.
Some 63,000 clients have now been onboarded onto the platform, which eliminates the need for multiple logins and user interfaces, making all trade and service transactions smoother for clients.
fyn also unifies data across multiple product-specific portals and back-office systems to create a single view of transactions, positions and balances, enabling self servicing.
Across the year, Kotak’s corporate banking business went from strength to strength, supporting a robust financial performance, underscored by a 29% increase in profit before tax of Rs26.53 billion ($310 million) and a return on assets of 1.4% for the nine months from April to December 2023.
In addition, the bank grew the number of corporate clients to 8,550 – up from 8,200 in the previous year.
