New Delhi: The Union Cabinet today gave its in-principle approval to a proposal for the merger of five associate banks and the Bharatiya Mahila Bank with the State Bank of India.
The five banks include the State Bank of Bikaner and Jaipur, State Bank of Travancore, State Bank of Patiala, State Bank of Mysore and State Bank of Hyderabad.
The SBI had last month given its nod to the proposal of the merger of subsidiary banks and Bhartiya Mahila Bank.
It is expected that the merger will not create any asset quality problem for the parent bank.
Meanwhile, SBI Chairperson Arundhati Bhattacharya said merger of SBI and its associate banks is a win-win for both the sides.
"Currently, no Indian bank features in the top 50 banks of the world. With this merger, some visibility at global level is likely to increase. Customers of associates and subsidiaries of the Bank will also be beneficiaries," she said.
She further said that with this merger the network of SBI will increase and its reach multiply. One can expect efficiencies to be created from rationalisation of branches, common treasury pooling and proper deployment of a large skilled resource base, Bhattacharya said.
"Customers of associates and subsidiaries of the Bank will also be beneficiaries. Any introduction of new technology by SBI would simultaneously be available uniformly. The scale of operations and common cost would get rationalised. Overall, the synergies being pooled at one place are going to be a big positive," she added.
The merger will create a behemoth with an asset base of Rs 37 lakh crore, over 50 crore customers, 22,500 branches and nearly 60,000 ATMs. SBI alone has 16,500 branches including 199 offices in 36 countries.
SBI first merged State Bank of Saurashtra with itself in 2008. Two years later, State Bank of Indore was merged.
SBI, country’s largest commercial bank, is still not among the top 50 banks in the world. It is ranked only 67th among its global peers.
