SBI awaits CBO’s nod for closing Muscat branch

The Muscat branch of State Bank of India (SBI) could soon put its shutters down as the lender has approached the Central Bank of Oman (CBO) for the approval to wind up its business in the sultanate.

“We have written to the CBO for the permission and are now waiting for their decision. Once we get the permission from the CBO the bank would start completing closure formalities, which includes asking local staff to go, settling all liabilities and transferring assets,” a bank official who did not wish to be named said.

SBI has operations in 36 countries with nearly 190 overseas branches. The countries where SBI is either closing down branches or merging small branches to rationalise costs include China, Sri Lanka, Oman, Saudi Arabia, France and Botswana.

“As a part of its strategy to rationalise branch operations outside India, SBI has already closed six branches and is now in the process of shutting down other nine branches including Oman operations,” the bank official said.

Besides SBI, India’s other public sector banks such as Bank of Baroda, Punjab National Bank, Indian Overseas Bank, IDBI Bank and Bank of India are likely to shut one-third of their overseas branches.

According to the source, the decision to close the only branch of SBI in Oman, which started operations in 2004, comes as a surprise to many as the branch since its inception has never made losses though profits were below expectations.
Besides having 29 permanent employees, the SBI’s Muscat branch was also involved in the business of remittance, which is currently being managed by its local partners.

SBI’s Oman branch also serves a variety of Indian consumers and provides services such as commercial, personal and e-banking services, as per the information on its website.

“We also provide attestation and verification to Indian consumers, which means anyone willing to take a home loan or other products in India could get his or her documents verified from us,” the official added.

Some aggrieved customers have also approached the Indian Embassy in Muscat complaining about the problems they could face if the branch is closed and have requested them to take up the matter with India’s Ministry of Commerce, the official said.

“Some have also written to the CBO, and the apex bank is also looking into the matter why profitability of the branch was lower than expected,” the official said, adding that the CBO is also not very happy with the decision and has sought Oman’s Ministry of Commerce’s intervention in the matter.

Muscat Daily Contribution Time: 30-Aug-2018 08:09 (GMT)
Muscat Daily Last Update Time: 30-Aug-2018 08:09 (GMT)