SBI all set to merge subsidiaries with it

The largest lender in the country, State Bank of India is all set to grow to a mammoth size. The bank is under proceedings to merge the five subsidiary banks in it. The lender expects to complete the formalities involved in 12-18 months.

State Bank of India is expected to benefit a lot from the merger as it will reduce administrative overheads and the bank will be able to utilize the employees to the full extent.

In a statement Finance Ministry said “The consolidation is aimed at making the State Bank Group a stronger and more resilient organization.”

“While SBI has also stepped up its efforts to grow organically, the inorganic growth through mergers would also help the bank in scaling up within an acceptable time frame, to enable it to compete on an equal footing with foreign banks, not only in India but in the international economic arena as well,” informed the standing committee.

SBI has been working in this direction for 2 years now. Last year the bank merged State Bank of Saurashtra and State bank of Indore with it and now working on the five others.

The Finance Ministry also said “The merger of subsidiary banks with itself is thus more in the nature of restructuring leaving size, market share etc of the Group unchanged but leading to better operational efficiency.”

SBI in no hurry to raise deposit rates

The largest lender of the country State Bank of India has announced that it does not have any intentions of increasing the deposit rates in near future.

After the announcement of hike in the key lending rates by The Reserve Bank of India after the meeting on 25^th January, most of the banks have announced a hike in their deposit rates and a few other banks are soon going to increase their deposit rates.

Previously, State Bank of India raised their deposit rates thrice in past six months but for now it does not have any plans for the same.

Earlier the Reserve Bank of India expressed it concerns on the increasing gap between the loan and the deposits amounts.

SBI raises FCNR deposit rates

The largest Public Sector Bank of the country State Bank of India has raised the Foreign Currency Non Residential (FCNR) deposit on various currencies by up to 46 basis points. The bank raised deposit rates on selected currencies over various maturities.

The bank has announced a 28 basis point hike of deposits in pound sterling over all the maturities. The bank revised the deposit rates in Euro by 10 basis points to 2.57 percent over maturity of one year and less than two years.

The bank revised deposit rates for some other currencies including Yen and Canadian Dollar over various maturities. The bank kept the deposit rates unchanged for deposits in American Dollar.