Public Sector Banks have now come out with a proposal to rationalise overseas operations, through consolidation of 35 operations and thus close down non viable branches as part of the clean and accountable banking initiatives. Following are the bodies that would be consolidated:
- Bank branches
- Remittance Centres and
- Representative offices.
The proposal will be taken up without inconveniencing the international operations of PSBs in the countries, wherein the operation is going to be taken up. Also, 69 operations are identified for further examination. As a Government initiative, which is to clean up and provide responsible banking services, this move is being initiated. Also, this will pave way towards best cost management and bring in better collective operations with the overseas market.
Why this move has come up now?
- The fraud that occurred in Punjab National Bank recently, to the tune of Rs. 12,700 crore in connivance with PNB staff and officials of overseas branches of other bank branches has promoted this action.
- Cluster of operational areas, which are not viable are found to be an issue and may lead to further frauds in the coming days which requires to be arrested through corrective actions.
At present, PSU Banks have around 165 branches overseas, apart from subsidiaries, joint ventures and representative offices. The counting shows the following details:
No. of overseas branches
|State Bank of India||52|
|Bank of Baroda||50|
|Bank of India||29|
PSBs Country-wise presence
We might recall that the Banking Sector agenda approved at PSB Manthan in November 2017, PSU Bank are required to examine all the 216 overseas operations and hence this move is taken up now.