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August - September 2009


Business Forum

A SMALL STRIDE BY The PUNJAB NATIONAL BANK (INTERNATIONAL) LTD may lead to huge benefits for the Punjab and India

by Mr S.R. Sharma, Managing Director the Punjab National Bank (


In the present global melt-down of banking giants in Britain and the United States, there is one Indian bank i.e. Punjab National Bank that is adventurous and confident enough to expand its foothold in the UK through its wholly owned subsidiary, Punjab National Bank (International) Ltd [PNBIL].

The Punjab National Bank, established in Lahore (presently in Pakistan) in 1895 is the third largest bank in India in terms of assets and second largest in terms of branch network, with more than 4600 offices. With 57.8% holding of Govt. of India and a balance sheet size of around $52 billion, it is one of the most profitable banks in India. It was one of the pioneers amongst public sector banks to launch major IT initiatives in Indian banking. With all the branches on a centralised banking platform and with around 2200 ATMs, the Bank is providing Anywhere Anytime banking facility to its 38 million customers.

As a part of its global expansion plans, PNB has set up many overseas offices in countries like Hongkong, Nepal, Afghanistan, Kazakhastan, UAE, China etc. However, its most ambitious overseas initiative has been setting up of PNBIL in UK. Having started operations with two branches in London and Southall in May 2007, PNBIL has added another branch at Leicester in January 2009 and a fourth branch at Birmingham during April 2009. The Bank also launched its Debit Card and Internet Banking Services in Jan. 2009 and with an array of Retail as well as Wholesale banking products, is fully geared up to meet banking needs of its clients, especially expat Indians. PNBIL is on customer acquisition spree and presently has around 8000 deposit accounts with a customer deposit base of $ 178 millon and asset size of half a billion.

One of the main requirements of Indian diaspora is to remit their savings to India. PNBIL has recognised this as a focus area and offers one of the most competitive exchange rates for this purpose. There are no remittance charges for transfer of funds from PNBIL accounts to PNB accounts in India and nominal charges for remittances to accounts with other banks in India. For internet users, PNBIL has introduced Net-Remit facility where the exchange rate is more favourable. As a part of its drive to introduce more technology driven products, PNBIL plans to introduce On-Line deposit products to attract new customers.

The PNBIL has followed sound banking practices of its parent, leading to profitable operations from very first year. The PNBIL is authorised and regulated by FSA and is following the global best practices like IFRS standards for accounting purpose. The PNB which had put in capital of $ 50 million in PNBIL to start with, has pumped in additional capital of $ 25 millon in March 2009 and has agreed to contribute another $ 50 million as capital to meet the growing business needs of the PNBIL due to expansion. Thus it is a rare case of not only creation of jobs but also flow of capital from an emerging economy into a developed economy. The net result of this venture will be further stimulus to the economies of India and Britain and strengthening of their strategic business partnership.

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More articles by Mr S.R. Sharma, Managing Director the Punjab National Bank (

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