The largest private sector lender of the country, ICICI Bank has decided to put a halt in its growth plans in geographies of UK and Canada. The reason for the same has been the objections put by the regulatory bodies of these countries against the subsidiaries of the bank operating there. It is said that these subsidiaries are focused towards lending mainly to Indian companies.

The Financial Services Authority, UK, and the Office of the Superintendent of Financial Institutions , Canada have objected to the fact that these subsidiaries have major fraction of their loans given to some Indian companies, said sources having information in this regard.

The regulators demand the money raised from local deposits to be invested locally only.

Also prudential norms suggest that majority of funds not be placed with one borrower or one country only.

Commenting on the matter, ICICI Bank said, "In line with its articulated international business strategy, ICICI Bank's subsidiaries in the UK and Canada have focused primarily on partnering Indian companies in their international expansion, as well as for their foreign currency funding requirements in their operations in India.

In the new global regulatory scenario, regulators are increasingly requiring deposits raised in a particular geography to be deployed in the same domain. The Bank is proceeding cautiously with respect to its strategy for these subsidiaries, given the changes taking place in regulations."

"These subsidiaries remain profitable, with comfortable liquidity and very strong capital adequacy," it added.

However lenders like Punjab National Bank and Bank of Baroda, both of which have presence in UK have denied facing any problem of similar stature till now.