HONG KONG/MUMBAI • Singapore's biggest lender, DBS Group Holdings, and South African banking group FirstRand are in separate talks to buy Royal Bank of Scotland (RBS) Group's India unit, people with direct knowledge of the matter said.
Financial details of the transaction were not immediately clear, though one of the sources said the deal could fetch about US$200 million (S$279 million).
An Indian private sector lender is also likely to bid for the unit, another source directly involved in the process said, declining to give details.
RBS, 73 per cent owned by the British government, said in February it would shrink its banking operations, pulling out of about 25 countries, including India, to help it refocus on lending in Britain.
The India business of RBS comprises corporate and institutional banking, trade finance and cash management.
The planned sell-off of RBS' India assets will not involve its back-office outsourcing business in India, said the sources.
RBS was rescued by a £46 billion British government bailout during the 2007/09 financial crisis.
Before that, it was briefly among the world's biggest banks by assets after M&A-backed expansion and aggressive lending.
It has faced a long struggle back to health involving slashing its loan book and boosting capital ratios.
Chief Executive Ross McEwan has narrowed the Edinburgh-based bank's focus to British retail and commercial banking.
It has also slashed the size of its investment bank and sold businesses in the United States and around the world.
As part of its strategy to pull back from some foreign markets, RBS has been paring its presence in India in the recent past.
Last month, it announced the sale of its Indian private banking unit.
The takeover of RBS' corporate banking business in India, if completed, would help the local units of foreign lenders DBS or FirstRand compete better with bigger Indian rivals, most of who are state-owned, banking sector experts said.
DBS, FirstRand and RBS declined to comment.