DSP Merrill Lynch has decided on hiring an Indian national to succeed Kevan Watts as the head of its India operations, a report by Economic Times of India reveals.

Mr Watts had reportedly expressed his desire to retire in 2010 and the investment bank has since been evaluating candidates to fill the role, the news service said, citing an anonymous source.

This Indian national, who has yet to be named, will be responsible for all the bank's affairs in the country and signals that DSP Merrill Lynch is ready to have an Indian take the helm. Merrill Lynch had hired a foreigner to run the firm in 2008 after it increased its stake in DSP Merrill to a hundred per cent.

“Mr Watts is a fine human being and a capable person. But, perhaps, Merrill Lynch has understood the importance of a local banker to run its Indian business," the source, the head of a major financial services firm, was quoted to have said.

India, along with China, is attracting major international banks due to the rise in the number of high net worth clients whose investment plates remain largely untapped. Local firms that are preparing to join the big league are also seeking private banking and advisory services to help expand their businesses.

DSP Merrill Lynch had declined to comment on the matter.