New Delhi: In a bid to establish an international banking business presence, Punjab & Sind Bank is all set to operationalise an IFSC Banking Unit (IBU) at GIFT City in Gandhinagar by November this year.
The bank has received regulatory approvals from both the Reserve Bank of India and the International Financial Services Centres Authority (IFSCA) to set up an IBU, Punjab & Sind MD and CEO Swarup Kumar Saha told PTI in an interview.
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“The IBU is going to play as a foreign branch and this will provide a lot of scope for expanding business in terms of mobilisation of Foreign Currency Non-Resident (Bank) and External Commercial Borrowings. This branch will help expand our balance sheet size and we also intend to bring in foreign exchange business,” he said.
The public sector lender has already put the staff in place and an IT vendor has also been selected, he said, adding, “IT integration has also started. So, we intend to operationalise IBU by November.”
Asked about FCNR(B) deposit mobilisation under RBI’s special window, Saha said the bank is looking to mobilise USD 25 million given its challenge of no branches or operations overseas.
Besides, he said, the bank also intends to raise USD 75 million through ECBs and Overseas Foreign Currency Borrowings (OFCBs).
So, the total mobilisation from overseas markets would be to the tune of USD 100 million by December.
In a bid to attract foreign currency deposits by Non-Resident Indians (NRIs), Overseas Citizens of India (OCIs) and Persons of Indian Origin (PIOs), the Reserve Bank of India last month withdrew the interest rate ceiling on fresh Foreign Currency Non-Resident (Bank) deposits of 3-5 years' maturity. The special window is open till September 30.
The move came after FCNR(B) deposit inflows weakened sharply, with net inflows dropping to just USD 946 million in FY26, down from USD 7.1 billion in FY25.
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In 2023, the RBI had introduced similar schemes when dollar outflows were high, triggered by the taper tantrum.
Last week, Punjab & Sind Bank reported a 23 percent rise in net profit to Rs 331 crore during the June quarter, aided by improvement in core income and decline in bad debts.
The public sector lender had earned a net profit of Rs 269 crore in the same quarter of the previous fiscal year.
The total income increased to Rs 3,546 crore during the June quarter from Rs 3,379 crore in the same quarter of the previous fiscal year.
Interest earned by the bank increased to Rs 3,213 crore compared to Rs 2,911 crore in the June quarter of FY26.
The bank's net interest income also increased 15 percent to Rs 1,038 crore from Rs 900 crore in the same quarter of the previous financial year.
Net interest margin stood at 2.53 percent at the end of the quarter under review.
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