India's Punjab National Bank opens DIFC branch

Punjab National Bank (PNB), one of the largest banks in India with over 5,000 branches and a business of over $100 billion (Dh3.67 trillion), has launched its DIFC branch following the inauguration on Saturday by Namo Narain Meena, India's Minister of State for Finance.

Talking to Emirates Business on the sidelines of the inaugural functions, KR Kamath, Chairman and Managing Director of PNB, said, the bank, though has a presence in DIFC with a Category 1 licence, nurtures bigger ambitions for the UAE.

"We are open to the idea of entering the country's banking market through a joint venture or acquisition. We have to assess how much capital will be required and what sort of returns we can expect before a decision on the same is made," said Kamath.

He said although the bank had presence in a few countries and was also finalising its entry into a few other markets including Canada, the net interest margin (NIM) from overseas operations was less than that from its Indian operations.

"The bulk of the overseas revenue comes from international trade and so the returns are generally benchmarked against rates such as Libor. And hence, we don't want to rush to add more overseas operations as capital is always pricey," he said.

Kamath is confident that Dubai will offer the bank a good market as it is considered one of the top international markets in the region.

"I don't want to commit any figure now, but our presence in this market will be felt soon," he added. He said the bank had already stabilised in Hong Kong and the United Kingdom. "We will move to Canada, Australia, and soon we will upgrade our representative office in Oslo to a full-fledged branch," he said.

Established in 1895, PNB has the distinction of being the first Indian bank to have been started solely with Indian capital. The bank was nationalised in July 1969 along with other 13 banks. Kamath said the bank will establish 100,000 touch points within three years from now as part of the Vision 2013.

PNB, with 5,000 plus outlets, 3,500 ATMs and over 56 million customers, is the largest nationalised bank in India in terms of profits as well as other key business parameters. The bank already has a branch in Kabul, two branches in Hong Kong, representative offices at Almaty, Dubai, Shanghai and Oslo, a wholly owned subsidiary in the UK (with five branches), and a joint venture with Everest Bank, Nepal.

It has also started a joint venture banking subsidiary DRUK PNB Bank in Bhutan.

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