The State Bank of India counter is buzzing in trade and in the last five trading sessions has gained about 4 per cent on reports that the merger process of its subsidiaries will possibly start by the end of October. The entire process is scheduled to be completed before the next financial year.
Speaking to BTVi , SBI Managing Director Dinesh Kumar Khara says the bank is awaiting recommendations of the shareholders’ grievance committee. After that, the scheme of the merger will be sent to the RBI and then to the government. The entire process is likely to be completed by the end of March 2017, he said. Excerpts:
As far as the merger process is concerned, we are going ahead with the issues approved by the board and the respective banks. And now we are waiting for the recommendations of the shareholders’ grievance committee.
And based upon its recommendation, if there is any requirement of revisiting any staff issues, we will look into it. Otherwise the merger scheme is required to be submitted to the RBI which in turn will be recommending to the Centre for the merger. And once the scheme is approved by the government, there will be an effective date, which is actually 30-day past notification.
We expect the shareholders’ grievance committee to submit its recommendations by the end of this month and thereafter the board will submit the schemes to the RBI. That is the kind of a timeline we are looking at.
The markets are keenly watching any update on staff realignment and optimisation of workforce? Have you worked out anything as far as the number of staff you will be realigning?
This is in the working process right now. We are looking into various issues. As far as branch networks, I will say it will be branch rationalisation, — we will possibly relocate branches to optimise the operations.
‘That is something which we have in mind. There is an ample scope for us to reach out to many locations, through which we can reach out to more customers and offer other services.
SBI’s marginal cost of funds-based lending rate (MCLR) is at present lower than those of its subsidiaries. What kind of realignment are you working with as far as the rates are concerned?
As far as the rates are concerned, it is essentially all linked to MCLR. We will be offering a one-time offer to various customers and depending on the action, the rates will be realigned.