New Delhi: State Bank of India (SBI) has closed six foreign branches and is in the process of closing down another nine branches as part of rationalisation of overseas operations, said managing director Pravin K. Gupta.
SBI, country’s largest lender, has operations in about 36 countries with nearly 190 branches.
“Capital is generally a constraint for most of the bank sites. Obviously, you want to use your capital at the place where it is best utilised. So, as a part of our foreign branch rationalisation, we have closed about six branches already in the last two years. There are nine more branches under the process to be closed down,” Gupta told PTI in an interview.
Not all the branches in the foreign locations are full-fledged offices, he said, adding that in countries like Bangladesh and South Africa there are some small branches as well as some retail branches and there is need to rationalise them. Even as the public sector banks have been mandated by the department of financial services to wind-up businesses at unviable locations, SBI itself was looking to rationalise the foreign offices before the order came, Gupta said.
As per the banking sector agenda approved at the PSB Manthan in November last year, public sector banks (PSBs) were asked to examine all of 216 overseas operations.
“Branch rationalisation is an ongoing process. I think every branch has to justify its existence. So unless it is commercially viable, it doesn’t make sense for us to be operating particularly in foreign locations,” he added.
