Foreign branches of public sector banks like State Bank of India and Allahabad Bank provided loans to Nirav Modi-promoted companies against fraudulent Letters of Undertaking (LoUs) issued by the PNB’s Brady House branch in Mumbai.
According to sources, Bank of India, Andhra Bank, IDBI Bank and Indian Overseas Bank have already closed down Dubai operations, while Punjab National Bank, Canara Bank and Union Bank of India have shut Shanghai offices. Bank of India has also closed down operations in Yangoon and Bostwana, while Bank of Baroda and Indian Overseas Bank have shut Hong Kong branch.
The government is planning to close all the non-viable operations overseas for cost efficiency and synergy. A committee headed by four-five bankers had recommended closing the international branches which are low on profitability.
As on January 31, 2018, public sector banks had about 165 overseas branches, besides subsidiaries, joint ventures and representative offices.
Note : India's largest lender State Bank of India has the largest number of overseas branches (52) followed by Bank of Baroda (50) and Bank of India (29).