SBI to hike stake in credit card JVs to 74% as GE seeks exit

16 Mar 2017

State Bank of India said it will hike its stake in its two credit card joint ventures with General Electric Company to 74 per cent.

The board of SBI has given approval to infuse Rs1,160 crore in the two JVs - SBI Cards and Payment Services Pvt Ltd (SBICPSL) and GE Capital Business Processes Management Services Ltd (GECBPMSL) - through purchase of equity shares from GE Capital so as to increase the bank's stake in both the companies to 74 per cent, SBI said in a BSE filing.

The American company is seeking to exit SBI Cards.

SBI currently holds 60 per cent stake in SBICPSL and 40 per cent in GECBPMSL. The balance is held by GE Capital in both the ventures.

As per an agreement between SBI and GE Capital at the time of formation of SBI Cards, it was decided that whenever any party decides to exit the JV, the decision has to be on the basis of mutual understanding.

SBI, the nation's largest lender, entered credit card business in 1998 by roping GE Capital India, the consumer finance arm of US-based GE Capital.

Currently, SBI Cards' board has eight members, including three from GE Capital.