Government tells SBI to go slow on mergers
04 Jul 2009
Biting the dust as usual, the government has yielded to protesting bank employees and told State Bank of India not to go ahead with the amalgamation of its subsidiary State Bank of Indore. In turn, the bank unions have called off their protest.
Instead, the government has asked the SBI management to invite unions for talks and convince them about the merits of the consolidation proposal. According to reports, the Reserve Bank of India also has some reservations about the manner in which the SBI is going about merging its smaller subsidiaries into the parent company.
The boards of SBI and the State Bank of Indore had last month passed resolutions approving the consolidation proposal, provoking a protest by the unions in all the six associate banks of SBI.
But now, the SBI management has been asked to enter into discussions with the unions. This advice was given by deputy chief labour commissioner N K Prasad at a conciliation meeting with the representatives of the unions, the SBI management and the senior management of all six associate banks.
At the meeting on Saturday, the senior management of the other five associate banks - State Bank of Mysore, State Bank of Hyderabad, State Bank of Bikaner and Jaipur, State Bank of Patiala and State Bank of Travancore - made it clear that they did not wish to merge with SBI.
