Britain's state-owned bank Royal Bank of Scotland (RBS) has abandoned a sale process aimed at exiting its banking operations in India.
"RBS has concluded that it is not feasible to sell the business in its entirety," the bank told Bloomberg in an e-mailed statement.
However, the bank will now contemplate other alternatives to pull out of the Indian market to focus on consolidation in the home market. The options "may include winding down the remaining Indian operations or selling individual parts of the business."
RBS will serve pink slips to most of its 600 employees in India by the end of the year, as it gradually shuts down its local operations, a person familiar with the matter told the news agency.
"Employees in India will be treated fairly in line with the bank's global policies and local practices, and will be given clarity on their positions over the coming weeks," RBS said.
RBS, the largest state-owned bank in Britain, had sold its retail and commercial banking business in India in 2013. Since then, the bank has been trimming its presence in the country and sold its bullion financing business to IndusInd Bank and retail loan portfolio to RBL Bank last year.
The bank saw its net balance sheet exposure in India decline to Â£1.7 billion in the financial year 2014 from Â£2.0 billion in the previous year. The fall in exposure was due to a cutback in corporate lending. The bank was expected to continue its back-office operations in India. It had moved 60 back-office positions from the UK to India earlier in 2015.
Last month, IDFC Bank was reportedly in advanced talks to buy Royal Bank of Scotland (RBS's) corporate banking portfolio in an estimated deal worth about Rs 3,000 crore. Currently, the bank has assets worth Rs 10,500 crore in 10 branches and savings deposits of Rs 2,000 crore.