Govt likely to close down NBP Paris branch

ISLAMABAD: The Ministry of Finance is likely to close down NBP Paris branch due to incurring financial losses.

Sources have told Pakistan Today that the Ministry of Foreign affairs also asked Ministry of Defence production to register comments regarding the closure of the NBP Paris branch.

Earlier, Ministry of Finance had written a letter to the NBP as well as the Governor State Bank of Pakistan with regard to closure of the Paris branch of the government-owned bank.

MoFA has been informed by NBP that the branch would be closed due to incurring financial losses. On the other hand, sources said that the branch loss was less than Rs2 million in  year 2021 due to COVID-19 situation and business can be improved by having better business strategies.

Recently, the NBP has transferred the Pakistani Embassy account to a local French bank and NBP Paris maintains accounts on a limited number of accounts of Pakistanis living in France besides embassy staff accounts.

Meanwhile, the bank has also advised the Pakistani mission’s Procurement Wing to shift their accounts to NBP Frankfurt instead of a local French bank, due to their sensitive nature. 

The mission is of the opinion that although there would be some teething problems and delays initially, the system would get smooth overtime. 

It is pertinent to mention here that in year 2018 the government of Pakistan had also taken a decision to close down Paris branch but later on the decision was withdrawn giving the reason that it is the only Pakistani bank in France and once closed, it would be extremely difficult to open it again. 

Earlier, it was reported that NBP had shut down three foreign branches in different countries namely Bangladesh (Sylhet), Afghanistan (Jalalabad) and Uzbekistan (Tashkent).

The closure of foreign branches is being carried out under the bank management’s plan to overcome losses from these markets due to multiple operational challenges in the host countries.

Reportedly, the bank’s management planned to scale down its foreign operations last year which included several branches and subsidiaries for up to 14 entities. The bank reviewed its plan and focused on seven markets for winding up operations in the first phase whereas the rest of the closures will be decided later.