SBI Waits For RBI’s Nod On Merger Of Associate Banks
RBI is expected to give State Bank of India, the approval for the detailed merger plan of its associate banks. The approval from the central bank is expected anytime soon. The strategy of acquisition of all five associates along with the Report of the Expert Committee has been submitted to RBI for approval. Upon approval, RBI is going to submit the scheme of acquisition as approved by it to the Government of India for approval and issue of order of acquisition.
On the other hand, SBI has initiated the process of change of account number because of the suggested merger of associate banks. Previously the government cleared the proposal to merge SBI with its five associate banks, namely State Bank of Travancore, State Bank of Bikaner and Jaipur, State Bank of Mysore, State Bank of Patiala, State Bank of Hyderabad and the new Bharatiya Mahila Bank (BMB). During August, SBI mentioned that all its associate banks along with BMB will be merged into it and that will add an extra Rs 8 lakh crore to its assets, making it a banking behemoth having total assets of Rs 30 lakh crore, a rise of about 36 per cent. With the merger of all the five associates and BMB, SBI will turn into a global-sized bank and could compete with the largest in the world, boasting of 22,500 branches and 58,000 ATMs. It will have over 50 crore customers.
SBI has already merged two of its associates, State Bank of Saurashtra in 2008 and State Bank of Indore in 2010 with itself. Last week, SBI Chairperson Arundhati Bhattacharya announced that the merger of associate banks with SBI itself is advancing and demonetization did not affect it.
Also, the State Bank of India's digital transaction platforms are all set to tackle much higher transactions than the average level and post demonetization the channel has witnessed quantum jump in transactions. Speaking to the media in Coimbatore recently, SBI Chairperson Arundhati Bhattacharya declared that after demonetization the bank's Point of Sale (PoS) transactions have seen 200 per cent jump by value and 300 per cent volume wise
increase, showing that digital transactions are on the rise.
As the trading session commenced on 28th Nov, SBI share price dipped by 4 per cent. The stock is trading at Rs. 251.60 (down by 9 points).
SBI is one of the top 500 performing stocks for this quarter as identified by Dynamic Levels.
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Article Written by Madhurima Chowdhury