Having established a foothold in the UK, Punjab National Bank (PNB) plans to expand its European presence to include Germany and Italy in order to cater to the large Indian diaspora based in these markets.
The bank's 100 per cent-owned UK arm, PNB (International) Ltd (PNBIL), has been asked to look into the possibility of opening branches in Germany and Italy, Mr K. R. Kamath, PNB's Chairman and Managing Director, said here on Wednesday.
According to him, having an existing wholly-owned subsidiary in the UK would make it comparatively easier to obtain regulatory approvals for setting up branches across Europe.
PNBIL, which commenced operations in the UK in May 2007, would take care of the entire European operations of PNB, Mr Kamath added. PNB's plans to foray into Germany and Italy comes at a time when European banks are riding on choppy waters in the midst of a sovereign debt crisis facing the PIGS (Portugal, Ireland, Greece, Spain) economies.
Last week, Mr Kamath inaugurated PNBIL's seventh UK branch at Wolverhampton, a city and borough in West Midlands, England. On whether PNBIL had plans to open more branches in the UK this year, Mr Kamath said “we don't have anything in hand now”. At the same time, “we have started thinking of entering into other European countries where there is big Indian diaspora and not that many Indian banks,” he added.
Apart from its branches in the UK, PNB operates a representative office in Oslo (Norway), which it wishes to convert into a full-fledged branch. “For this, we require a memorandum of understanding between the Reserve Bank of India and the regulator there. I understand that it is happening and once that is done, we expect to obtain a branch licence”, Mr Kamath said.
PNB has also moved an application for opening a subsidiary in Canada, which is currently with the regulator of that country. Australia is the other country where the bank has received the approval for starting a representative office. “We have already moved our people to Sydney, where the office will be opened in the next 2-3 months,” he added.