PNB applies to open branches in Pakistan

PNB has applied for opening branches in Lahore and Karachi, but approval is yet to come from competent authority

Government today said state-owned bank PNB has applied for opening branches in Pakistan and is awaiting approval from the competent authority.

"Punjab National Bank has applied for opening of two branches in Pakistan, one each in Lahore and Karachi, but these branches have not been approved by the competent authority," Minister of State for Finance Namo Narain Meena said in a written reply to the Lok Sabha.

No Indian bank has presence in Pakistan, he said.

The State Bank of Pakistan (SBP) had indicated to the Reserve Bank of India last month that Muslim Commercial Bank was also interested in opening a branch in India apart from two other Pakistani banks, Meena added.

RBI has advised SBP this month that banks from Pakistan may apply as per the extant policy for the presence of foreign banks in India.

In reply to another question, Meena said that under the aegis of the World Trade Organisation, India is committed to allow foreign banks to open 12 branches in a year.

"RBI may, however, go beyond the WTO commitments of 12 branch licences, if the foreign banks open offices in unbanked or under-banked areas," he said.

While considering application for opening of branches by foreign banks, RBI also considers the nature and scope of banking facilities provided by these banks to common persons particularly in under-banked areas; actual credit flow to the priority sector; pricing of products and so on, he said.

Replying to another question, Meena said RBI is examining the issues associated with the usage, holding and trading of virtual currencies, including bitcoins, under the extant legal and regulatory framework of the country, including foreign exchange and payment systems laws and regulations.

"The public at large has been informed that the creation, trading or usage of virtual currencies as a medium for payment are not authorised by any central bank or monetary authority," he said.

No regulatory approvals, registration or authorisations have been obtained by the entities concerned for carrying on such activities, he said, adding, as such, "they may pose several risks to their users".