State Bank of Indore to merge with SBI; workers plan stir
20 Jun 2009
Continuing to merge with its subsidiaries, State Bank of India (SBI), the country's largest bank, said that it would acquire State Bank of Indore, under a plan approved by the boards of both banks, approved yesterday.
State Bank of Indore, the smallest among State Bank of India's associate banks, will be the second of SBI's associate banks to merge with India's largest lender by assets. State Bank of Saurashtra had merged with SBI last year.
SBI chairman O P Bhatt yestrday said the size of associate banks wouldn't be a consideration while proceeding with the merger process.
"It (merger) depends on the response from the respective leadership at those banks at the board level. Wherever there is a more proactive board, we will take those banks first,'' Bhatt told reporters ahead of the bank's annual general meeting.
Soon after the announcement, State Bank of Indore employees threatened to go on nation-wide strike on 22 June to stall the proposed merger. "As per the advice of AIBEA and AIBOA, the entire employees and officers of State Bank of Indore will observe a strike on 22 June," said All India Bank Employees' Association general secretary C H Venkatachalam.
Earlier this month, the union had already announced nation-wide strike by associate banks on 3 July.
Vekatachalam in the statement said despite the protest by the workman director, Atul Pradhan, the board of State Bank of Indore approved the resolution by majority vote.
SBI and its six associate banks control about a quarter of India's bank deposits and loans. The union government is pushing the merger of state-run banks to give them scale in the global economy.
SBI holds a 98.05-per cent stake in State Bank of Indore.
