Follow Us:
Wednesday, December 11, 2019

SBI, associates merger by March end: Arundhati Bhattacharya

Merger to create one of the largest lenders in Asia

By: ENS Economic Bureau | New Delhi | Updated: July 30, 2016 4:45:05 am
state bank of india, sbi, bank merger, sbi psb merger, arundhuti bhattacharya, sbi chief, public sector banks sbi merger, sbi associate banks, bank strike, business news, india news, “People have to understand that change is inevitable. There have been strikes at many occasions but we have to educate them … take them on board,” Arundhati Bhattacharya, said. (Source: PTI file photo)

Even as employees of public sector banks went on one-day strike on Friday to protest State Bank of India’s plans to merge its associate banks, SBI chairman Arundhati Bhattacharya said merger process will be completed by year end as people would be taken on board. SBI plans merge its five associate banks and Bharatiya Mahila Bank with itself. “People have to understand that the change is inevitable. There have been strike at many occasions but we have to educate them and take them on board,” she said on the sidelines of the launch SBI’s wealth management offering called ‘SBI Exclusif’.

Asked as to when the proposed merger would be complete, she said “timeline is around by the end of the financial year (for merger to get over).” The proposed merger will likely create one of the largest lenders in Asia, with an asset base of Rs 37 lakh crore.

SBI has five associate banks — State Bank of Bikaner and Jaipur, State Bank of Travancore, State Bank of Patiala, State Bank of Mysore and State Bank of Hyderabad. Of these, State Bank of Patiala and State Bank of Hyderabad are unlisted. SBI first merged State Bank of Saurashtra with itself in 2008. Two years later, State Bank of Indore was merged. When asked on bank’s plans for reduction in non-performing assets (NPAs), she said, “NPA is a continuing battle, so we will continue to fight that battle on many fronts. The idea is to make resolution as quickly as possible.” SBI’s gross NPAs rose to 6.5 per cent of gross advances as of March 2016, from 4.25 per cent a year ago.

Speaking about its wealth management services business, she said SBI Exclusif is targeted at both existing and new customers.

Meanwhile, during the launch of SBI’s wealth management offering in a separate event later in the evening on Friday, finance minister Arun Jaitley said people world over are shifting to alternative instruments which have the potential to provide better returns than bank deposits.

Watch Video: What’s making news

“It (bank deposit) is certainly safe, but then the whole concept of economic system that banking system pay high rate of interest for those deposits were no longer relevant. And world over people have successfully experimented it. “The conventional deposit rate, the lending rate are very low but you have very powerful alternative instruments in which if you invest you will earn a lot higher. That is how the pension funds and sovereign funds are surviving and doing extremely well,” he said while launching SBI Exclusif. The Bank, he said, can play a role in helping large section of retired persons who were trying to live a respectable life on the strength of their savings.

“In India now as that opportunity expands, as a number of people with additional resources increases, you need a set of competent managers to manage the resources,” Jaitley said. The bank’s wealth management customers will have access to a dedicated Relationship Manager supported by a team of investment experts to take care of all their banking and investment needs for customers who earn a monthly income of Rs 2 lakh per month or have fixed deposits of Rs 30 lakh or Rs 1 crore housing loan.



For all the latest Business News, download Indian Express App