Pakistan's Soneri Bank mulls India foray

Will approach RBI for approval, plans three branches in Amritsar initially; bank mum on investment

Lahore-based Soneri Bank Ltd is planning to enter India, starting with a branch in Amritsar, followed at a later date with more in Delhi and Mumbai.

“We are completely ready with our plan. Once we obtain the necessary approvals, we will go full steam. This will be our first ever international foray,” Alauddin Feerasta, chairman, told Business Standard.

He said they’d soon approach the Reserve Bank of India (RBI). The Karachi Stock Exchange-listed company has 240 bank branches across Pakistan, employing around 3,000 people.

“Our plan is to first open a branch in Amritsar and then as business progresses, we will gradually look at the larger markets of Delhi and Mumbai. We have not decided on how much to invest, as we have to see RBI’s requirements and then the board (of directors) will decide,” Feerasta added.

EASE OF BUSINESS

Developments in India-Pakistan trade dialogue

1. Increase the trading hours at the Attari-Wagah Land Stations and to keep it open 24x7
2. Allow cargo containers between Amritsar and Lahore
3. Give each other trade benefits under the Most Favoured Nation norms under a changed nomenclature, non-discriminatory market access, resulting in Pakistan allowing more goods to be imported from India from around 8,000 now
4. Allow banking branches to operate in each other’s countries
5. Liberalise business visa regime

Source: Joint statement issued on January 25 after the meeting between Commerce and Industry Minister Anand Sharma and Pakistan’s Minister of Commerce and Textiles Khurram Dastagir Khan

Amritsar, he noted, was close to Lahore, where the bank has its headquarters. Besides, “there are several problems the business community faces while doing business across the border. This is because there is complete absence of a robust banking channel. Even a small thing like a letter of credit acts as a big hurdle for them,” he said.

Soneri operates in corporate, retail, trading and commercial banking. On personnel, Feerasta said he was “ready”. The plan is to hire locally for the key management positions, reporting to the chief executive officer and chief financial officer in Lahore. For the remaining posts, they plan to recruit Indian professionals.

As the first step, Soneri will have to get approval from Pakistan’s ministries of finance and commerce.

Recently, Pakistan commerce and textiles minister Khurram Dastagir Khan said they were in talks with Delhi to allow three Pak banks to operate here. The three nominated were National Bank of Pakistan, United Bank Ltd and Muslim Commercial Bank.