Lok Sabha passes bill approving merger of
associate banks with SBI
The government today said the merger
of the five associate banks with the SBI will lead to increased capital base
and availability of loan, as the Lok Sabha passed the bill approving the
amalgamation.
The
Lok Sabha passed the bill to repeal the SBI (Subsidiary Banks) Act 1959, State
Bank of Hyderabad Act 1956 and to further amend the State Bank of India Act,
1955, following the merger of five associates with the parent SBI.
This merger, the SBI has come in the list of top 50
banks globally and is ranked at the 45th position.
The merger will bring about increased capital base and
increased ability to give loans. Also, small banks will get access to products
like mutual funds.
According
to the statement of object and reasons of the State Banks (Repeal and
Amendment) Bill 2017, after the acquisition of the subsidiary banks by SBI, the
subsidiary banks have ceased to exist and, therefore, it is necessary to repeal
the State Bank of India (Subsidiary Banks) Act, 1959 and the State Bank of
Hyderabad Act, 1956.
Five associates and the Bharatiya Mahila Bank became
part of State Bank of India (SBI) beginning April 1, catapulting the countrys
largest lender to among the top 50 banks in the world. The five associates that
were merged are State Bank of Bikaner and Jaipur (SBBJ), State Bank of
Hyderabad (SBH), State Bank of Mysore (SBM), State Bank of Patiala (SBP) and
State Bank of Travancore (SBT)( These banks were subsidiaries of the SB).
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