In order to further expand the banking services across the country, banks intend to open 715 new branches under their annual branch expansion plan during the current calendar year 2013 (CY13). Sources in the banking sector told Business Recorder on Wednesday that banks, Islami Banks and Microfinance Banks had planned to open hundreds of new branches with millions of rupees investment under their annual expansion plan aimed at getting new business and facilitate the masses across the country.
Under the State Bank of Pakistan''s Branch License Policy (BLP), conventional banks, Islamic Banks and Microfinance Banks, which desire to open new business places during a calendar year, are required to submit their Annual Branch Expansion Plan (ABEP) to the central bank for consideration and appropriate approval.
With starting of CY13, various conventional, Islamic and Microfinance banks have submitted their ABEP-2013 with the State Bank for opening of new branches. The banking sector has informed SBP that they have planned to open 715 branches across the country during CY13 aimed at further expanding their banking services and facilities the areas, which they seems potential for banking industry.
The locations identified by banks for opening new branches are well-diversified throughout the country covering all the four provinces of Pakistan, Northern Areas, Azad Jammu & Kashmir and Islamabad, sources said. In addition, out of total planned branches for current calendar year, as many as 486 branches would be set-up by conventional banks and 229 by the Islamic banks. While applications for opening of permanent booths will be considered by the SBP on individual basis as the banks will require opening booths and applying with SBP.
During the current calendar year, banks will open new branches equal to last calendar year 2012, in which the banks applied to open 713 branches across the country; however they opened some 717 branches including sub-branches of conventional, Islamic banking branches and permanent booths. Banks opened 417 new branches during CY10, 570 in CY11 and now banks have planned 715 branches, sub-branches and Permanente booths of Islamic and conventional banks.
As on February 28, 2013, the total numbers of bank branches operating in the country reached 11,093 compared to 10,442 in CY12. With the opening/addition of new branches, sub-branches and permanent booths, the total number of bank branches across the country will reach 11,808 end of CY13.
Sources said that under the BLP, banks are required to open at least 20 percent of their new branches in rural/under-served areas (RUAs). RUAs mean villages, small towns and also those Tehsil Headquarters where there is no branch of any bank. Therefore, banks will be required to open some 140 branches RUAs during current calendar year to fulfil the SBP mandatory requirement of opening of 20 percent in rural areas.
During the last calendar year, Islamic banking industry has witnessed healthy growth and for the first time in the history, the branches of the Islamic Banking Industry have crossed 1,000 mark at the end of CY12. It may be mentioned here that presently, some 11,093 branches of banks (including 6 Islamic banks) are operating across the country. This comprises 9,323 conventional banks'' branches, 1026 Islamic banks, 396 sub branches, 68 Islamic Sub-Branches and 280 permanent booths.
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