Treasury Merger by SBI

Dr. D. Nithya | Assistant Professor

Sankara Institute of Management Science(SIMS)

Five associate banks of SBI and Bharatiya Mahila Bank(BMB) were on 1^st April merged with SBI.

The five associate banks are as follows:

1. State Bank of Mysore
2. State Bank of Hyderabad
3. State Bank of Patiala
4. State Bank of Bikaner and Jaipur
5. State Bank of Travancore

The merger of the above banks was approved by Union government in the month of February 2017 and in March 2017 for BMB and it came into effect on 1^st April 2017.

Back ground of the Merger

This initiative of merger stated in 2008. In 2008 the State Bank of Saurashtra merged with SBI and in 2010 State Bank of Indore merged with SBI. The State Bank of India has around 16500 branches which includes 191 foreign offices across 36 countries.

Key Lights of the Merger

By this merger State Bank of India will join the league of top five banks globally in terms of assets. As of now there is no Indian Bank featured in the list. This merger will pay way for more customer base with approximately 37 Crore with branch network of around 24000 and nearly 59000 ATMS across the country.  The deposit rate tends to increase including advances.  The bank will rationalize its branches by relocating some of the branches. This will lead the bank to optimize its operations and work on maximizing profitability.  Merger of the five associate banks with SBI will lead to cost saving and effective operational mechanism.