SBI to acquire two small subsidiaries: report

18 June 2009

State Bank of India, the country's largest lender, is readying merger plans to absorb two of its minor subsidies, according to a report. SBI Commercial and International Bank (SBICI), a fully-owned unit with just two branches in Mumbai, is one of them and the merger may take place by the end of this year, The Economic Times quoted an unnamed senior official in the finance ministry as saying.

The other merger involves factoring services provider Global Trade Finance (GTF), in which SBI owns a 92.60 per cent stake and Bank of Maharashtra the rest. This is slated for merger with SBI Factors, which is in the same line of business.

''Since SBICI is a wholly-owned subsidiary of SBI, there should not be any problem. For GTF, they (SBI) need to get approval from the board of Bank of Maharashtra,'' the source said.

In the case of GTF, the issue has been discussed informally between SBI and the finance ministry officials. SBI officials said Bank of Maharashtra has no objection to the merger plan, but an official view will be firmed up by its board, the report adds.

SBI emerges as top taxpayer
Meanwhile SBI emerged as the largest pre-payer of tax for the first quarter, making it the first time in the history of corporate India that a bank became the country's highest tax-payer. Former leader Oil and Natural Gas Corporation slipped to second place.

According to the advance tax data for the first quarter April-June 2009, SBI posted a handsome growth in its profit while depositing Rs1,068 crore in the tax kitty, while state-owned ONGC deposited Rs890 crore.