PNB COMPLETES MAJORITY STAKE BUY IN KAZAKH BANK

Punjab National Bank (PNB) has announced the completion of acquisition of 63.64 per cent stake in JSC Dana Bank of Kazakhstan. This acquisition is valued at $23.765 million (3.5 billion Tenge) for which PNB has been issued 35 million shares of 1,000 Tenge each at par.

This acquisition will give PNB an operational presence in Kazakhstan, which is the largest economy in Central Asia. PNB already has a presence in Kazakhstan through its representative office in Almaty since 1998.

Currently, JSC Dana Bank has five branches, of which three at Almaty, Pavlador and Karganda are operational and the remaining two at Astana and Taraz are expected to be operationalised soon. Plans are afoot to open two more new branches at Atrau and Akhtau in 2011.

A foothold in Kazakhstan has been considered crucial for PNB due to increased bilateral business opportunities and growing per capita income in Kazakhstan, which has natural resources aplenty. Also, many Indian oil and gas, pharmaceuticals and engineering companies have already set up offices in Kazhakhstan.

Gateway to CIS countries

With there being no other Indian bank in CIS countries other than in Russia, Kazhakhstan is being seen as gateway for CIS countries with regard to tapping India-centric business.

PNB has been looking to evolve itself into a global bank and the latest majority stake buy in JSC Dana Bank of Kazakhstan is a step towards fulfilling that aspiration, say banking industry observers. Already, PNB has an overseas joint venture with Everest Bank of Nepal and another joint venture in Bhutan by the name Druk PNB Bank Ltd.

As part of its efforts to enhance its international presence, PNB has applied to the Canadian regulators for setting up a wholly owned subsidiary in Canada. This would be the second wholly owned overseas banking subsidiary for PNB, after PNB International (UK) Ltd.

SOURCE: http://www.thehindubusinessline.com/2010/12/15/stories/2010121553850100.htm