National Bank of Pakistan (NBP) has closed three international branches in Bangladesh (Sylhet), Afghanistan (Jalalabad), and Uzbekistan (Tashkent) in recent months.
The bank’s management is closing international branches as part of a plan to reduce losses in these markets due to several operational issues in the host nations.
Last year, the bank’s management planned to reduce its international activities, which included up to 14 branches and subsidiaries. The bank evaluated its strategy and chose to focus on seven markets in the first phase, with the rest of the closures to be decided later.
One more branch in Turkmenistan (Ashgabat) is being closed, as are two subsidiaries in Tajikistan (Dushanbe) and Kazakhstan (Almaty). The host countries’ banking regulators have revoked the licenses of these outlets, and the closure of branches is currently happening.
Over the previous few years, earnings from branches and subsidiaries have steadily declined. Some branches are likewise losing money with no hope of recovering.
The public sector bank was fined $55.4 million (Rs. 9.8 billion) by US authorities in February 2022 for non-compliance with anti-money laundering legislation. The branch has not yet been shuttered, but management has begun a rapid compliance program as a corrective remedy under the supervision of the bank’s board of directors.
Pakistan’s presence in the global banking industry has dwindled over the previous five years as local banks’ branches, subsidiaries, and affiliate companies have been rapidly shuttered, primarily due to losses and non-compliance with rules.
Not all international transactions are difficult for the bank. UNBL, NBP, and UBL’s joint venture are profitable, earning over Rs. 100 million in the first quarter of 2022.
United National Bank of Canada Inc. UNBL was established in 2001 as a joint venture between NBP and UBL following the merging of United Bank Limited’s UK branches and the National Bank of Pakistan’s UK branches, both of which had been operating in the UK since the mid-1960s. UNBL’s main activities include providing retail banking products to customers through its branch network and agents in key UK cities, wholesale banking, treasury, and money transmission services to financial institutions, and trade finance to firms of all sizes.
(UNBL) is a United Kingdom-based financial institution. It has six locations in London: Central, Ilford, Bradford, Birmingham, Manchester, and Glasgow.