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21
March 2017
 |
S.B.I (The Total Investment & Insurance
Solutions)
State
Bank of India (SBI), which will see five associate banks merge into it on April
1, has decided to shut down almost half the offices of these banks, including
the head offices of three of them. This process will start from April 24. The Total Investment & Insurance Solutions
"Out
of the five head offices of the associate banks, we will retain only two. Three
head offices of the associate banks will be unbound along with 27 zonal
offices, 81 regional offices and 11 network offices of the associate
banks," SBI Managing Director Dinesh Kumar Khara told IANS in an
interview. The Total Investment & Insurance
Solutions
"We
will keep their structure in place till April 24 and, post that, we will start
dismantling the associate banks' controlling offices, which includes head
offices, regional offices, zonal offices and network offices," Khara said.
The
five associate banks that will merge with SBI are: SBBJ (State Bank of Bikaner
and Jaipur), SBM (State Bank of Mysore), SBT (State Bank of Travancore), SBP
(State Bank of Patiala) and SBH (State Bank of Hyderabad). The Total Investment & Insurance Solutions
SBI
is India's largest bank with assets of Rs 30.72 lakh crore and figures at No.
64 in the global ranking of banks (as of December 2015; December 2016 ranking
is still awaited). Post-merger, with assets of approximately Rs 40 lakh crore,
it will be among the top 50 banks in the world. SBI Chief Economist Soumya Kanti
Ghosh told IANS that, post-merger, the bank will be at No. 45. The Total Investment & Insurance Solutions
The
shur-down move is to avoid overlapping offices in the same area and "we
intend to remove any kind of duplicacy in the controlling structure", Khara
said.
The
five associate banks will cease to exist as legal entities and become a part of
SBI from April 1, but the various merger processes will start only after April
24, once the balance sheets of the five entities are audited and added. The Total Investment & Insurance Solutions
"We
will have to get the balance sheets of the associate banks audited a day prior
to the merger, that is, on March 31. The balance sheets of the banks will be
drawn up and added; it takes 15-20 days. Soon after the audit is done, the
branches will be completely merged with SBI," Khara told. The Total Investment & Insurance Solutions
There
are currently 550 SBI offices while its associate banks have 259. The target
for the number of controlling offices after the merger is 687 -- a reduction of
122 offices.
Employees
directly affected by these shutdowns -- estimated at 1,107 -- will be
redeployed, mostly in customer-interface operations, Khara said.
"The
net result is that people in controlling functions will be available for
deployment on the ground for improving reach to the consumer," he said.
"There
are about 5-7 people in every regional office and 20-odd people in each zonal
office. One regional office controls 30-40 branches, while 4-5 regional offices
are controlled by one zonal office," he told. The Total Investment & Insurance Solutions
The
associate banks have also offered a Voluntary Retirement Scheme (VRS) to
employees who do not wish to relocate. "VRS is only an option, else they
will be relocated. They will have a different role," he said. The Total Investment & Insurance Solutions
Along
with the winding-up of these offices, a number of merger processes will come
into effect simultaneously, including the data merger of the five entities.
"Data
merger will also start from April 24 and we will finish it by May end. That is
the plan of action," he said, adding that the bank had given itself six
months to complete all merger-related processes. The Total Investment & Insurance Solutions
"I
would rather say that within a quarter all the things should be in order.
Ideally, we would like to have it in one quarter, but it will not spill over
beyond the second quarter," Khara said.
SBI
says the merger will be done seamlessly as it has the experience of two earlier
mergers. State Bank of Indore was merged with SBI in 2010, while State Bank of
Saurashtra was merged in 2008.The Total
Investment & Insurance Solutions
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