SBI unions ready for merger of associate banks

Discussion in 'Economy & Infrastructure' started by H.A., May 26, 2012.

  1. H.A.

    H.A. Senior Member Senior Member

    Dec 24, 2011
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    The forthcoming 25th Triennial General Council meeting of the All India State Bank Officers’ Federation (AISBOF) is expected to pass a resolution supporting the merger of the five associate banks of State Bank of India, making them into one entity.

    The five associate banks are State Bank of Travancore, State Bank of Hyderabad, State Bank of Patiala, State Bank of Mysore and State Bank of Bikaner & Jaipur.

    But the unions will oppose the merger of any of these banks with State Bank of India.

    The AISBOF “fully endorses” the demand of the Associate Banks’ Officers’ Association “for ending the subsidiary or ‘associate’ status of these banks’’, the resolution reads.

    “The continuance of these banks as associates of State Bank of India is anachronistic,” it says, adding that it may have been justified when State Bank of India was the only public sector bank, but not now.

    “The AISBOF General Council urges the government to take speedy action for integration of the five associate banks into one bank and to vest the ownership of the bank with the Central Government,” the resolution says.

    However, when asked why the unions were okay with the merger of these banks into one entity, but not with SBI, Mr G.D. Nadaf, General Secretary, AISBOF, said that the unions were really in favour of these five banks remaining separate entities.

    But if the government has to merge many banks into one, then most of the unions were okay with the merger of the associate banks into one entity, but not with SBI.

    Mr Nadaf said that after the merger of State Bank of Sourashtra and State Bank of Indore with State Bank of India, the SBI management was keen on merging the other associate banks also.

    But it did not proceed because the State Bank of India was financially not in a position to do so.

    However, now that SBI’s performance is good, the merger proposal would be taken up again, Mr Nadaf, who is also the Officer-Director on the board of SBI, told Business Line.

    Observing that “consolidation and competition do not go together,” Mr Nadaf said the unions would fight any proposal to merge the associate banks with SBI.

    Business Line : Industry & Economy / Banking : SBI unions ready for merger of associate banks

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