SBI to complete merger of 6 banks in three months

State Bank of India, which would start merger process of five associates and Bharatiya Mahila Bank (BMB) from April 1, expects integration to be completed in three months. 

"SBI has sought three-month time from RBI for merger. It should be done by that timeframe," SBI Managing Director (national banking group) Rajnish Kumar said here. "The merger has to be done in phases. As data are integrated, the new passbook and cheque books would be issued. The complete integration of various banks should take 3 months," he said. 

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SBI to merge with associates from 1st April

The government on Thursday said that 1 April will be the record date for the merger of State Bank of India (SBI) with five of its associate banks.The associate banks are State Bank of Bikaner and Jaipur (SBBJ), State Bank of Mysore (SBM), State Bank of Travancore (SBT), State Bank of Hyderabad (SBH) and State Bank of Patiala (SBP).

In a gazette notification dated 22 February and released on Thursday, the government said that all shares of these associate banks would cease to exist as individual entities and would stand transferred to SBI.

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SBI pushes merger of 5 associate banks,Bharatiya Mahila Bank to next quarter

The merger of the five associate banks with State Bank of India (SBI) will be postponed to by a quarter due to the demonetization exercise, acknowledged SBI chief Arundhati Bhattacharya who for weeks had said that the merger is as per the schedule. The bank had announced in May plans to merge its five associate banks with itself by March 2017 to emerge as a global bank in order to compete with peers in emerging markets. 

Speaking to media on Monday on whether the merger of associate bank is as per the schedule, Bhattacharya said that the merger will “probably be delayed by a quarter”. She said that the delay has been because the government has not notified the merger. 

“The reason is we still have to get government approval. Even if I get the approval right now doing things in the last quarter is not a wise thing. There will be a lot of IT system changes and normally by mid-February we close down all IT system changes as these can impact something else quit unknowingly. We do not want to take any risks at the annual closing time. So we may just want to do the annual closing then look at it,” she said. 

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State Bank of Hyderabad Q2 result, Posts net loss of Rs776.64 crore

State Bank of Hyderabad reported a net loss of Rs776.64 crore for the quarter ended 30 September, due to higher provisions against bad loans. The bank reported a net profit of Rs375.31 crore in the same quarter a year earlier.

Provisions and contingencies surged 755% to Rs2,074.94 crore in the July-September quarter from Rs242.70 crore a year earlier. The loss during the second quarter was restricted due to a tax write-back of Rs197.12 crore against tax expenses of Rs189.87 crore a year ago.

This is one of the biggest losses reported by an associate bank of the State Bank of India (SBI). In the April-June period, State Bank of Travancore had reported a loss of Rs743 crore due to deteriorating asset quality concerns.

The drop in profitability of associate banks might be a result of the impending merger with State Bank of India, which has been approved by all of them. In August, the respective boards of SBI, State Bank of Bikaner & Jaipur, State Bank of Mysore, State Bank of Travancore, State Bank of Hyderabad and Bharatiya Mahila Bank had all approved the mega merger, which will create a large banking conglomerate in India. According to a Mint analysis, this will put SBI in the ranks of the top 50 lenders in the world.

The associate banks reported large losses as a direct result of the asset quality review (AQR) conducted by RBI in the October-December period last year, SBI management had stated earlier.

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Bankers to strike against merger of SBI associates

Opposing the central government's decision to merge State Bank of India's (SBI) five associate banks with the former, around 45,000 employees of the associate banks will strike on July 12, said a top official.

The All India Bank Employees'Association (AIBEA) official said that on July 13, there will be a nationwide strike in all banks by AIBEA and All India Bank Officers' Confederation (AIBOC).

"Consolidation in the banking industry is not a priority now. On the other hand, recovery of the bad loans should be the priority. Prior to the July 12 strike we will hold series of demonstrations opposing the merger," CH Venkatachalam, general secretary, AIBEA told IANS.

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SBI merger to create banking powerhouse

In a definitive push for consolidation in the banking sector, the Union Cabinet on Wednesday gave a go-ahead to the of State Bank of India (SBI) with its five associate lenders and Bharatiya Mahila Bank. The combined entity would create a financial sector powerhouse, with total assets worth Rs 29.7 lakh crore.

SBI has indicated it wants to complete the merger in 2016-17. While India's largest lender would reap benefits of scale and a larger balance sheet, it will be a major challenge to integrate staff and rationalise branches.

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Cabinet approves merger of 5 associate banks with SBI

The Union Cabinet on Wednesday approved the merger of 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 as well as Bharatiya Mahila Bank with State Bank of India, according to TV reports.

Last month, SBI cleared proposal for merger of subsidiary banks and Bharatiya Mahila Bank.

“Kindly await a structured briefing on that,” Telecom Minister Ravi Shankar Prasad said when asked if the Cabinet approved the merger of associate banks with the SBI.

Arundhati Bhattacharya, chairman, SBI said, “The merger of SBI and its associate banks is a win-win for both. While the network of SBI would stand to increase, its reach would multiply. One can expect efficiencies to be created from rationalisation of branches, common treasury pooling and proper deployment of a large skilled resource base. Currently, no Indian bank features in the top 50 banks of the world. With this merger, some visibility at global level is likely to increase. Customers of associates and subsidiaries of the bank will also be beneficiaries.”

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State Bank of Hyderabad Q4 Net Drops 43% To Rs 253 Crore

State Bank of Hyderabad (SBH) on Sunday said its net profit for the quarter ended March 31 dropped by 43.2 per cent to Rs 253 crore due to higher provisioning for non-performing assets (NPAs).

The public sector lender had registered a net profit of Rs 445.5 crore for the corresponding period a year ago.

Managing director Santanu Mukherjee said that SBH allocated Rs 664.34 crore towards contingencies and provisioning during the January-March quarter as against Rs 431.17 crore in the year-ago period.

"Adequate provisions suggested by RBI (Reserve Bank of India) in respect to stressed accounts identified under early recognition process have been made by the bank. In addition to these, additional provision is also made to take care of future requirements of other assets under stress," Mr Mukherjee said at a press conference.

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History of State Bank of Hyderabad

A subsidiary of State Bank of India, State Bank of Hyderabad was established as Hyderabad State Bank on 8 August 1941. The Bank started its operations with the distinction of being the central bank of the princely state of Hyderabad, covering the present-day Telangana region of Andhra Pradesh, Hyderabad-Karnataka of Karnataka and Marathwada of Maharashtra, when it was established. Apart from functioning as a commercial bank, it managed Osmania Sikka (the currency of Hyderabad in those days) and managed public debt as well. The first branch of the Bank was established at Gunfoundry, Hyderabad on 5 April 1942. 

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