JPMorgan Chase plans to shift around 30% of back office and support jobs at its investment banking division to offshore centres in India by the end of 2007, according to a Financial Times report.
The US bank plans to employ 4500 graduates in India over the next two years says the report.
JPMorgan will process the bulk of its foreign exchange trades at centres in Mumbai and Bangalore. It is also moving over much of the processing of credit derivatives contracts.
The bank is currently hiring between 300 and 400 graduates a month and eventually plans to have a total of 9000 staff in India by the end of 2007 - around 20% of the its current headcount.
Around 3000 staff will be working for the investment bank, with the rest supporting JPMorgan's retail and commercial banking operations, including 2000 call centre workers.
Veronique Weill, head of operations at JPMorgan's investment bank, told the FT that the offshoring initiative is not just about cost savings. She says the quality of the people the bank hires in India is "extraordinary" and their level of loyalty to the bank is "unbeatable".
Earlier this year US investment bank Goldman Sachs said it would shift more middle and front office functions to India as part of a $30m investment in its offshore facilities.
Other banks including Bank of America and HSBC are also expanding their offshore operations in Asia. HSBC plans to almost double the number of staff employed at its back office centres in Asia over the next three years and cut more jobs at its operations in Europe and the US, while Bank of America has set up a second offshore unit in Mumbai.
UBS is also expanding its offshore operations with the establishment of a processing centre in Hyderabad, India.