Approach RBI to open branch in Lahore: FM tells OBC

Written by Agencies | New Delhi, March 31: | Updated: Mar 31 2008, 21:21pm hrs
Finance Minister P Chidambaram on Monday asked the Oriental Bank of Commerce (OBC) to approach the Reserve Bank for opening a branch in Lahore, from where the bank had started operations 63 years ago.

"This bank was founded in 1943 in Lahore. Today it does not have a branch in Lahore. That is unfortunate. I urge the Chairman to apply to the Reserve Bank. Let's take a chance.

Let's see how the new government in Pakistan responds" Chidambaram said, at a function of OBC in New Delhi. The Finance Minister's statement assumes significance as Pakistan's Commerce Secretary Syed Asif Shah earlier this month had said banks from India and Pakistan may soon be able to set up branches across the border, since most of the issues have been addressed.

"Apparently those delays have been sorted out and the applications would have reached in the central bank of both the countries, and beyond that there should not be any problem," Shah had said.

The Reserve Bank of India has already proposed the names of State Bank of India and Bank of India for opening branches in Pakistan, while United Bank and National Bank of Pakistan have shown interest to set up their branches in the country.

The development followed an agreement reached between the RBI and State Bank of Pakistan to permit opening of branches by banks from India and Pakistan on a reciprocal basis. Pointing out that banking was expanding at a frantic pace, Chidambaram said, people needed to keep pace with the changing scenario so as to rise with the occasion.

He also asked banks to rise to become a world-class institutions by expanding activities in areas like educational loan, credit flow to weaker sections, credit flow to women, minorities and rural areas will help in the growth of the bank.