Mumbai, Aug 20 (IANS) The country’s largest lender State Bank of India on Saturday said it is looking to add $120 billion (Rs 8 lakh crore) assets following the merger of all its associates banks and Bhartiya Mahila Bank with it.
The SBI has decided to merge all its associate banks — State Bank of Bikaner and Jaipur, State bank of Travancore, State Bank of Patiala, State Bank of Hyderabad and State Bank of Maharashtra and Bhartiya Mahila Bank Ltd.
After the merger, the bank will have a network of more than 24,000 branches, 2,70,000 employees and total assets of Rs 30 lakh crore, which will increase by 36 per cent, a statement said.
The SBI with its origin in Bank of Kolkata in the early 19th century was created out of the merger of the Presidency Banks.
“The mergers will catapult the SBI into the top 50 banks globally and is in furtherance of the bank’s mission statement to be of service in the remotest parts of India,” it said.
The lender said the mergers would allow it to leverage operational synergies, reach out to new clients and improve market share by ensuring a better reach through enlarged presence.
According to the bank, increased presence in all terrains and geographies will increase the bank’s deposit raising capacity and bring down the cost of funds further. Thus, the benefit so derived will flow on to the customers in the form of improved services, borrowing costs etc.
The reduction in overheads, administrative offices and centralisation of treasury will in itself lead to substantial reduction in operating costs.
“Post the mergers, the SBI will re-deploy manpower in customer facing roles with a sharper marketing focus,” it said.
Additional capital requirement (which is not significant) arising on account of the mergers will be met through the resultant increase in efficiencies and economies of scale, the lender said.