The State Bank of India (Subsidiary Banks) Act, was passed
in 1959 to make certain government associated banks subsidiaries of SBI. The
constitution and management of these banks are decided by the provisions of
this act. While each bank has its own MD, SBI chairman Arundhati Bhattacharya is
the organisational head.
Highlights
1.
This legislation resulted in 8 state banks
associates of SBI, namely-State Bank of Bikaner, State Bank of Jaipur, State
Bank of Hyderabad, State Bank of Mysore, State Bank of Indore, State Bank of
Patiala, State Bank of Saurashtra, State Bank of Travancore.
2.
Later in 1963, State Bank of Bikaner and State
Bank of Jaipur were merged together to form State Bank of Bikaner and Jaipur.
3.
In 2008, State Bank of Saurashtra was absorbed
by SBI bringing down the count of associate banks to six.
4.
In 2009, SBI merged State Bank of Indore with
itself, leaving five associate banks operational at present.
5.
Recently, it was proposed that some of the
associate banks will be merged with the parent bank. In June 2014, Chairman
Arundhati Bhattacharya said that move will be taken ahead to enhance the bank’s
asset base.
Let us take a look at each of the associate banks’ brief
history and background.
1. State
Bank of Bikaner and Jaipur (SBBJ): The beginning of State Bank of Bikaner
and Jaipur dates back to the year 1943-44, when the Bank of Jaipur Ltd. and Bank
of Bikaner Ltd. were founded. In 1960, both banks were incorporated as
subsidiaries of State Bank of India and in 1963, they were merged to form a
single entity. The parent bank (SBI) has a 75% stake in SBBJ. Their annual
report states that the bank’s total business as on March 2015 amounted to
Rs.155392 crores, operational profit is Rs.2104.11 crores and loans sanctioned to
priority sectors were amounted to Rs.27860 crores. Gross NPA was set at Rs.2945.14
crores. As of 2013 it had 1049 branches. Jyoti Ghosh is the MD.
2. State
Bank of Hyderabad (SBH): State Bank of Hyderabad is headquartered at
Hyderabad, Telangana. It was founded Hyderabad State Bank in 1941 by Mir Osman
Ali Khan. It became SBI’s in 1956 and now its largest associate bank. Their
annual report states that the bank’s operating profit as on March 2015
wasRs.2913 crores. GNPA was at Rs.4984 crores. It has 1800 branches. Santanu
Mukherjee is the MD.
3. State
Bank of Mysore (SBM): State Bank of Mysore headquartered at Bengaluru was founded
in 1913 as the Bank of Mysore Ltd. under the patronage of Maharaja Krishna Raja
Wadiyar IV. In 1953 the bank was appointed as RBI’s agent to manage government
business and treasury operations. In March 1960, it became SBI’s subsidiary. As
on March 2015 SBM has widespread network of 1,015 Branches. Its net profits
stand at Rs.409 crores during the financial year ended March 2015. Total
Deposits of the Bank as at the end of March 2015 stood at Rs.66,064 crores and
the total Advances stood at Rs.53,296
crores. It has recorded a trading turnover of Rs.3,51,198 crores. SBM has a workforce
of 10,193 employees. Sharad Sharma is the MD.
4. State
Bank of Patiala (SBP): The history of State Bank of Patiala dates back to 1917,
when it was founded by Late Bhupinder Singh, Maharaja of erstwhile Patiala
state. It became SBI’s subsidiary in 1960. While in the year 2014-15, its
business crossed Rs.173000 crores, net profits were 362.06 crores and operating
profits amounting to Rs.1599 crores. It has 1300 branches. GNPA stands at 5.41
crores. Ramesh Rangan is the MD of the bank. It is headquartered in Patiala
5. State
Bank of Travancore (SBT): It was originally established as Travancore Bank
Ltd. in 1945 sponsored by the former princely state of Travancore. As on March 2014,
SBI had a network of 1117 branches and 14491 employees. Its net profits stood
at Rs304.34 crores and total reserves were to the tune of Rs.4959.82 crores. Loans
to priority sector was to the tune of Rs.29179 crores. Jeevandas Narayan is the
bank’s MD.
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