CHENNAI: Forty one out of 159 overseas branches of public sector banks were in loss as of financial year 2016-17, according to data presented in Parliament.
``Public sector banks are jointly working on a note on consolidation of overseas branches,’’ Shiv Pratap Shukla, Minister for State for Finance, said in a written reply to Lok Sabha.
State Bank of India had 9 loss-making overseas branches, Bank of India 8 and Bank of Baroda 7, according to the data.
IDBI Bank, Indian Bank, Syndicate Bank and UCO Bank had operated one loss-making branch each in foreign countries. While Indian Overseas Bank operated 5 loss-making branches, PunjabNational Bank and Union Bank of India had two such branches each. Canara Bank had 4 loss-making overseas branches.
“A reforms agenda based on recommendations made by whole-time directors and senior management of PSBs has been referred by the Government to public sector banks for appropriate action as per approval of bank boards,” Mr. Shukla, said.
The agenda covers, inter alia, rationalisation of overseas operations for cost efficiencies and synergies in overseas markets based on competitive strength and viability, and a differentiated banking strategy to leverage bank’s competitive advantage, including branch network rationalisation, for strong regional connect, he added.
All public sector banks having overseas branches had jointly taken the initiative to prepare a note in mutual consultation for rationalisation of their foreign branches, Mr. Shukla said.
Overseas branches of public sector banks are in spotlight in the wake of the Punjab National Bank scam and following Bank of Baroda’s decision to exit South African operations.
