SBI To Merge Five Associate Banks With Itself

The State Bank of India will initiate consolidation in the banking industry by combining its five associate banks as it prepares to fund the economy. The move will enhance the asset base of SBI to Rs 21.9 lakh crore and add 5,658 branches to its current number of 15,143 branches. The combined market share will rise to 24% from the current 19%.

SBI’s five associates include the State Bank of Travancore, the State Bank of Hyderabad, the State Bank of Patiala, the State Bank of Bikaner and Jaipur and the State Bank of Mysore.

“When I came in, there were a number of fires in the parent itself. So if you have to do something, first you need to look at the mother ship. Once the mother ship is in a better form, then obviously, you can start looking at other areas. So I think that time has come or it is approaching,” said SBI chairperson Arundhati Bhattacharya.

She called for changes in a number of laws enacted by the previous UPA government like the Land Acquisition Act and the Companies Act.

“While it (the Land Acquisition Act) has done a good thing to ensure that landowners get adequate compensation, the process has become long (the relief and rehabilitation process is too difficult to negotiate). In the new Companies Act, there are various features that make it so draconian that it is difficult to source independent members of the board,” she said.