PNB opens more foreign offices, raises more capital this year

Kolkata, Dec 08 (UNI) With a view to improving its capital base further, Punjab National Bank(PNB) has decided to raise Rs 400 crore as Tier-II capital next month and make provisions to open a number of foreign offices by March 2007, PNB Chairman and Managing Director S C Gupta said here today .

Speaking to newsmen after addressing members of the Federation of Indian Chambers of Commerce and Industry(FICCI) on Challeges facing the Indian Banking Industry, Mr Gupta said in order to improve the Capital Adequacy ratio of the Bank from around 11.2 per cent as on March, 2006, the PNB Board in accordance with the fresh RBI guidelines had first decided to raise Rs 1500 crore in August before opting for another Rs 500 crore earlier this month as Tier II capital.

" Though these have helped the Bank improve its Capital Adequacy Ratio to just less than 12 per cent, we have now decided to raise another about Rs 400 crore by next month to be conmfortably placed as far as the capital requiremets are concerned, " the PNB Chairman said.

Regarding his plan to go global to improve PNB's business portfolios further within the next one year, Mr Gupta said so far PNB had operated only one full fledged overseas branch at Kabul in addition to three representative offices in Shanghai, Dubai and London.

" But now we have decided to open the second overseas branch in HonkKong and two subsidiary branches in Vancouver(Canada) and London in association with two local Banks. We will also open 75 new local branches, " he said adding in addition one off shore unit of PNB would be opened in Singapore during the curerent fiscal.

Necessary clearance had already been received from the RBI as well as from the concerned countries.

Following the opening of new foreign offices, the global business of the Bank would be increased manifold from almost a negligible proportion at present, Mr Gupta said.

Asked about his long pending decision to open a joint branch at Alma Ata in Kazakastan in association with the Indian Overseas Bank, the PNB Chief said the proposal had now been shelved because of some technical reasons.

He, however, did not elaborate.

Regarding the PNB's total business target for the current fiscal, Mr Gupta said after touching Rs 1.56 lakh crore business in September this year, they were confident of achieving the Rs 2.10 lakh crore target by March, 2007, of which the advance portfolio would be to the tune of more than Rs 105,000 crore.

He said, " In tune with Union Finance Minister's directives to all 19 public sector Banks yesterday asking them to market aggressively for a balanced credit disbursement to the SME, agricultural and manufacturing sectors and go slow for the retail business, we have accordingly decided to take very conservative steps in terms of financing the retail business particularly the proposals for the construction of Special Economic Zones(SEZ) anywhere in the country. " Earlier during his interactive session with FICCI members, the PNB Chairman gave a detailed account of the Paradigm shift of the Indian Banking Industry in terms of their business outlook and customer satisfaction since 2001 and claimed that all the 19 Public sector Banks had been facing the challenge quite efficiently.

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