Punjabi community presence behind our success story in UK: PNB

Focusing on retail and operating through its subsidiary, Punjab National Bank (International) now has seven branches in UK that are mostly operating in areas dominated by the Punjabi community including at Southhall, Birmingham and Wolverhampton.

"In a span of four years, we have 30,000 Indian accounts (mostly of those from Punjabi community) in these seven branches. Even the British High Commission has showcased it as a success story," PNB Chairman and Managing Director K R Kamath told reporters here today.

He said PNB International will take care of the bank's entire operations in Europe, as the bank is now eyeing its presence in other European nations over the next two years.
"We try to go to untreaded path and explore new avenues," he said.

About presence of the Punjabi community in numbers in UK, Kamath gave an example of Wolverhampton, where he recently paid a visit, saying the tiny place has 35 Gurudwaras.
Kamath said during the current year, the bank is looking for a total of USD 2 billion deposit and advances by the subsidiary.

With presence in nine countries, he talked about few more expansions including opening up of a representation office in Australia and Canada, which also have good number of Punjabis settled there.

The bank is vigorously pursuing the case of upgrading its office in Norwegian capital Oslo into a full-fledged branch.

PNB, which has its roots in Pakistani City of Lahore, would also put its stake whenever in future the governments on both sides decide to open a branch there.

"As far as our bank having a branch in Lahore is concerned, it is subject to availability of licence. Being more of a political issue, it has to be decided by both the governments first...but I can say if climate for our bank going there in future is there, we will make our stake very strongly because our roots are there," he said.

Kamath also spoke about the bank's success story in Nepal, where it turned a loss-making Everest Bank Ltd into a profit-making one after taking it over 13 years back.
"We hold a 30 per cent stake in the bank," he said.Kamath also said that the bank through its subsidiary in Bhutan now has three branches. "Even the Bhutanese government has acknowledged that we have changed the banking culture in the country," he said.

The bank also has presence in Kabul, Hong Kong and Dubai.Kamath said during the year ended March 2011, the bank registered an overall profit of Rs 4,433 crore, excluding the profit made by its international subsidiary.

Punjab National Bank (International) made an operating profit of almost USD 10 million in the year ended March, 2011, he added.

PNB, which has a total of 5,200 branches in the country and plans to open 100 more branches during the current year, may by August finalise a partner for its life insurance business after having received financial bids from three players -- Aviva, Bharti AXA and Metlife, he said.

"Over the next couple of months, we should close this process," he said.With EMIs for loans, including home loans, are set to go up again after the Reserve Bank hiked key interest rates by 25 basis points, Kamath, however said: "Interest rate is not the villian as far as people getting affordable houses is concerned".

"How much will the EMI change. Interest rate is not the villian. Every housing loan spread over a period of 10-20 years will see 2-3 interest rate cycles and ultimately the interest rate gets evened out/averaged out," he said.

He said likewise for a project spread over seven years, interest rate is not the only deciding factor.He said the bank's BPLR or base lending rate was the lowest.
Kamath said the bank was going in for large scale recruitments in this year and plans to recruit 10,000 people under various categories.

He, however, clarified that this does not mean the bank has shortage of 10,000, but added, "it is the question of planning for future" which includes succession plans at the top level, where quite a number of retirements will take place by year 2020.