Project on State Bank of India

HISTORY OF STATE BANK OF INDIA T h e r o o t s o f t h e S t a t e B a n k o f I nd i a r e s t i n t h e f i r s t d e c a d e o f 1 9 t h c e n t u r y, wh e n t h e B a n k o f C a l c u t t a , l a t e r r e n a m e d t h e B a n k o f Bengal, was established on 2 June 1806. The Bank of Bengal and twoother Presidency banks, namely, theBank of Bombay(incorporatedo n 1 5 Ap r i l 1 8 4 0 ) a n d t h e Bank of Madras(incorporated on 1 July1843). All three Presidency banks were incorporated as joint stock companies, a n d w e r e t h e r e s u l t o f t h e royal charters. T h e s e t h r e e b a n k s r e c e i v e d t h e e x c l u s i v e r i g h t t o i s s u e p a p e r c u r r e n c y i n 1 8 6 1 with the Paper Currency Act, a right they retained until the formationof theReserve Bank of India. The Presidency banks amalgamated on27 January 1921, and the reorganized banking entity took as its nameI mp e r i a l B a n k of I n d i a . T h e I m p e r i a l B a n k o f I n d i a c o n t i n u e d t o remain a joint stock company.Pursuant to the provisions of the State Bank of India Act (1955), theR e s e r v e B a n k o f I n d i a , w h i c h i s I n d i a ' s c e n t r a l b a n k , a c q u i r e d a controlling interest in the Imperial Bank of India. On 30 April 1955the Imperial Bank of India became the State Bank of India. TheGovt. of Indiarecently acquired the Reserve Bank of India's stake in SBI soas to remove any conflict of interest because the RBI is the country's banking regulatory authority.Offices of the Bank of BengalIn 1959 the Government passed the State Bank of India (SubsidiaryBanks) Act, enabling the State Bank of India to take over eight former State-associated banks as its

subsidiaries. OnS e p t 1 3 , 2 0 0 8 , State Bank of Saurashtra, o n e o f i t s As s o c i a t e B a n k s , me r g e d wi t h S t a t e Bank of India.S B I h a s a c q u i r e d l o c a l b a n k s i n r e s c u e s . F o r

i n s t a n c e , i n 1 9 8 5, i t acquired Bank of Cochin inKerala, which had 120 branches. SBI wasthe acquirer as its affiliate,State Bank of Travancore, already had anextensive network in Kerala.

ASSOCIATE BANKS OF STATE BANK OF INDIA There are six associate banks that fall under SBI, and together these six banks constitute the State Bank Group. All use the same logo of a b l u e k e yh o l e and all the associates use the "State Bank of" n a me f o l l o w e d b y t h e r e g i o n a l h e a d q u a r t e r s ' n a me . O r i g i n a l l y, t h e t h e n s e v e n b a n k s t h a t b e c a me t h e a s s o c i a t e b a n k s b e l o n g e d t o princely statesuntil the government nationalized them between October, 1959and May, 1960. In tune with the first Five Year Plan, emphasizing thedevelopment of rural India, the government integrated these banks into State Bank of India to expand its rural outreach. There has been aproposal to merge all the associate banks into SBI to create a "mega b a n k " a n d s t r e a m l i n e o p e r a t i o n s . T h e f i r s t s t e p a l o n g t h e s e l i n e s occurred on 13 August 2008 whenState Bank of Saurashtramergedwith State Bank of India, which reduced the number of state banksf r o m s e v e n t o s i x . F u r t h e r m o r e o n 1 9 t h J u n e 2 0 0 9 t h e S B I b o a r d a p p r o v e d t h e me r g e r o f i t s s u b s i d i ar y, S t a t e B a n k o f I n d o r e , w i t h itself. SBI holds 98.3% in the bank, and the balance 1.77% is owned b y i n d i v i d u a l s , w h o h e l d t h e s h a r e s p r i o r t o i t s t a k e o v e r b y t h e government.T h e a c q u i s i t i o n o f S t a t e B a n k o f I n d o r e w i l l h e l p S B I a d d 4 7 0 branches to its existing networ k o f 1 1 , 4 4 8 . A l s o , f o l l o w i n g t h e acquisition, SBIs total assets will inch very close to the Rs 10-lakhcrore mark. Total assets of SBI and theState Bank of Indorestood atRs 998,119 crore as on March 2009. GROWTH OF STATE BANK OF INDIA State Bank of India has often acted as guarantor to th e Indian Government, most notably duringChandra Shekhar 's tenure asPrime Minister of India. With 11,448 branches and a further 6500+ associate bank branches, the SBI has extensive coverage. State Bank of

Indiahas electronically networked all of its branches under Core BankingSystem (CBS). The bank has one of the largestATMnetworks in theregion. More than 8500 ATMs across India. The State Bank of Indiahas had steady growth over its history, though it was marred by theHarshad Mehtascam in 1992. In recent years, the bank has sought toexpand its overseas operations by buying foreign banks. It is the onlyI n d i a n b a n k t o f e a t u r e i n t h e t o p 1 0 0 w o r l d b a n k s i n t h e Fortune Global 500rating and various other rankings

Is SBI a nationalized bank ?

Posted on September 18, 2013 by Way2Bank
People often get confused about whether SBI is a nationalized bank or not. This question has been asked quite often in various interviews. When one of our readers posted a similar question on our Facebook page, we thought of explaining this in detail here in our blog. SBI is NOT a Nationalized bank. It is a Public Sector Bank. Actually, SBI draws power from State Bank of India Act, 1955. Nationalized banks are the banks which were nationalized in two phases in 1969 and 1980. These banks were established under Banking Companies (Acquisition and Transfer of Undertakings) Acts, 1970 and 1980. So, these banks are governed by their respective statutes. In 1969, 14 Commercial banks were nationalized and in 1980, 6 more banks were nationalized. But, later in 1993, PNB and New India bank got merged taking the figure of nationalized banks to 19.

Now, couple of interesting question comes to our mind while we talk about nationalization of Banks, well try and answer these questions.

1) 2)

Why Nationalization of Banks was done by the Government?

To raise public confidence in Banking system Expansion of banking facilities in a uniform manner Provide banking facility in rural and sub-urban areas Sought to end the monopoly control of big industrialists upon the banking system Aimed at giving more credit to priority sectors To reduce regional economic inequalities To ensure enough development funds for the planned growth of the country Why SBI was not nationalized during the waves of Nationalization of Banks in 1969 and 1980?

SBI was already under State control in 1969/1980, vide SBI Act, 1955. So, there was no need of Nationalization of State Bank of India. Banks which were nationalized in 1969/1980 were either owned by private business groups or individual investors.

State Bank of India (SBI) is a multinational banking and financial services company based in India. It is a government-owned corporation with its headquarters in Mumbai, Maharashtra. As of December 2013, it had assets of US$388 billion and 17,000 branches, including 190 foreign offices, making it the largest [3][4] banking and financial services company in India by assets. State Bank of India is one of the Big Four banks of India, along with ICICI Bank, Punjab National Bank and Bank of Baroda. The bank traces its ancestry to British India, through the Imperial Bank of India, to the founding in 1806 of the Bank of Calcutta, making it the oldest commercial bank in the Indian Subcontinent. Bank of Madras merged into the other two presidency banksBank of Calcutta and Bank of Bombayto form the Imperial Bank of India, which in turn became the State Bank of India. Government of India owned the Imperial Bank of India in 1955, with Reserve Bank of India taking a 60% stake, and renamed it the State Bank of India. In 2008, the government took over the stake held by the Reserve Bank of India. SBI is a regional banking behemoth and has 20% market share in deposits and loans among Indian [5] commercial banks.

History[edit]

Seal of Imperial Bank of India.

The roots of the State Bank of India lie in the first decade of 19th century, when the Bank of Calcutta, later renamed the Bank of Bengal, was established on 2 June 1806. The Bank of Bengal was one of three Presidency banks, the other two being the Bank of Bombay (incorporated on 15 April 1840) and the Bank of Madras (incorporated on 1 July 1843). All three Presidency banks were incorporated as joint stock companiesand were the result of the royal charters. These three banks received the exclusive right to issue paper currency till 1861 when with the Paper Currency Act, the right was taken over by the Government of India. The Presidency banks amalgamated on 27 January 1921, and the re-organised banking entity took as its name Imperial Bank of India. The Imperial Bank of India remained a joint stock company but without Government participation.

Pursuant to the provisions of the State Bank of India Act of 1955, the Reserve Bank of India, which is India's central bank, acquired a controlling interest in the Imperial Bank of India. On 1 July 1955, the Imperial Bank of India became the State Bank of India. In 2008 the government of India acquired the Reserve Bank of India's stake in SBI so as to remove any conflict of interest because the RBI is the country's banking regulatory authority. In 1959, the government passed the State Bank of India (Subsidiary Banks) Act, which made eight state banks associates of SBI. A process of consolidation began on 13 September 2008, when the State Bank of Saurashtra merged with SBI. SBI has acquired local banks in rescues. The first was the Bank of Behar (est. 1911), which SBI acquired in 1969, together with its 28 branches. The next year SBI acquired National Bank of Lahore (est. 1942), which had 24 branches. Five years later, in 1975, SBI acquired Krishnaram Baldeo Bank, which had been established in 1916 in Gwalior State, under the patronage of Maharaja Madho Rao Scindia. The bank had been the Dukan Pichadi, a small moneylender, owned by the Maharaja. The new banks first manager was Jall N. Broacha, a Parsi. In 1985, SBI acquired the Bank of Cochin in Kerala, which had 120 branches. SBI was the acquirer as its affiliate, the State Bank of Travancore, already had an extensive network in Kerala. The State Bank of India and all its associate banks are identified by the same blue keyhole logo. The State Bank of India wordmark usually has one standard typeface, but also utilises other typefaces. On October 7, 2013, Arundhati Bhattacharya became the first woman to be appointed Chairperson of the [6] bank.

EVOLUTION OF SBI The origin of the State Bank of India goes back to the first decade of the nineteenth century with the establishment of the Bank of Calcutta in Calcutta on 2 June 1806. Three years later the bank received its charter and was re-designed as the Bank of Bengal (2 January 1809). A unique institution, it was the first joint-stock bank of British India sponsored by the Government of Bengal. The Bank of Bombay (15 April 1840) and the Bank of Madras (1 July 1843) followed the Bank of Bengal. These three banks remained at the apex of modern banking in India till their amalgamation as the Imperial Bank of India on 27 January 1921. Primarily Anglo-Indian creations, the three presidency banks came into existence either as a result of the compulsions of imperial finance or by the felt needs of local European commerce and were not imposed from outside in an arbitrary manner to modernise India's economy. Their evolution was, however, shaped by ideas culled from similar developments in Europe and England, and was influenced by changes occurring in the structure of both the local trading environment and those in the relations of the Indian economy to the economy of Europe and the global economic framework.

Establishment The establishment of the Bank Bank of Bengal marked the advent of limited liability,joint-stock banking in India.So was the associated innovation in banking, viz. the decision to allow the Bank of Bengal to issue notes, which would be accepted for payment of public revenues within a restricted geographical area. This right of note issue was very valuable not only for the Bank of Bengal but also its two siblings, the Banks of Bombay and Madras. It meant an accretion to the capital of the banks, a capital on which the proprietors did not have to pay any interest. The concept of deposit banking was also an innovation because the practice of accepting money for safekeeping (and in some cases,

even investment on behalf of the clients) by the indigenous bankers had not spread as a general habit in most parts of India. But, for a long time, and especially upto the time that the three presidency banks had a right of note issue, bank notes and government balances made up the bulk of the investible resources of the banks. The three banks were governed by royal charters, which were revised from time to time. Each charter provided for a share capital, four-fifth of which were privately subscribed and the rest owned by the provincial government. The members of the board of directors, which managed the affairs of each bank, were mostly proprietary directors representing the large European managing agency houses in India. The rest were government nominees, invariably civil servants, one of whom was elected as the president of the board.

Major change in the conditions

A major change in the conditions of operation of the Banks of Bengal, Bombay and Madras occurred after 1860. With the passing of the Paper Currency Act of 1861, the right of note issue of the presidency banks was abolished and the Government of India assumed from 1 March 1862 the sole power of issuing paper currency within British India. The task of management and circulation of the new currency notes was conferred on the presidency banks and the Government undertook to transfer the Treasury balances to the banks at places where the banks would open branches. None of the three banks had till then any branches (except the sole attempt and that too a short-lived one by the Bank of Bengal at Mirzapore in 1839) although the charters had given them such authority. But as soon as the three presidency bands were assured of the free use of government Treasury balances at places where they would open branches, they embarked on branch expansion at a rapid pace. By 1876, the branches, agencies and sub agencies of the three presidency banks covered most of the major parts and many

of the inland trade centres in India. While the Bank of Bengal had eighteen branches including its head office, seasonal branches and sub agencies, the Banks of Bombay and Madras had fifteen each.

First Five Year Plan

In 1951, when the First Five Year Plan was launched, the development of rural India was given the highest priority. The commercial banks of the country including the Imperial Bank of India had till then confined their operations to the urban sector and were not equipped to respond to the emergent needs of economic regeneration of the rural areas. In order, therefore, to serve the economy in general and the rural sector in particular, the All India Rural Credit Survey Committee recommended the creation of a state-partnered and statesponsored bank by taking over the Imperial Bank of India, and integrating with it, the former state-owned or state-associate banks. An act was accordingly passed in Parliament in May 1955 and the State Bank of India was constituted on 1 July 1955. More than a quarter of the resources of the Indian banking system thus passed under the direct control of the State. Later, the State Bank of India (Subsidiary Banks) Act was passed in 1959, enabling the State Bank of India to take over eight former State-associated banks as its subsidiaries (later named Associates). The State Bank of India was thus born with a new sense of social purpose aided by the 480 offices comprising branches, sub offices and three Local Head Offices inherited from the Imperial Bank. The concept of banking as mere repositories of the community's savings and lenders to creditworthy parties was soon to give way to the concept of purposeful banking subserving the growing and diversified financial needs of planned economic development. The State Bank of India was destined to act as the pacesetter in this respect and lead the Indian banking system into the exciting field of national development.

What are the main Functions of State Bank of India?

The functions of SBI can be grouped under two categories, viz., the Central Banking functions and ordinary banking functions. A. Central Banking Functions: The SBI acts as agent of the RBI at the places where the RBI has no branch. Accordingly, it renders the following functions: (a) Banker to the government (b) Banker to banks in a limited way (c) Maintenance of currency chest (d) Acts as clearing house (e) Renders promotional functions (1) Banker to the Government: The SBI functions as the banker to the central and state governments. It receives and pays money on behalf of the governments. Especially it renders the following functions as directed by the RBI in this regard. (a) Collection of charges on behalf of the government e.g. collection of tax and other payments (b) Grants loans and advances to the governments (c) provides advises to the government regarding economic conditions, etc., (2) Banker's Bank: Commercial Banks have accounts with SBI. When the banks face financial shortage, the SBI provides assistance to them as it is considered a big brother in the banking industry. It discounts the bills of the other commercial banks. Due to the functions on this line the SBI is considered in a limited sense as the banker's bank. (3) Currency Chest: The RBI maintains currency chests at its own offices. But RBI Offices are situated only in big cities. SBI, buy its wide network of branches operate in urban as well as rural areas. RBI therefore, in such places keeps money at currency chests with SBI.

Whenever needs arise, the currency is withdrawn from these chests under proper accounting and reporting to RBI. Presently RBI entrust currency chest to other Public Sector Banks and a few Private Sector Banks also. (4) Acts as Clearing House: In all the places, where RBI has no branch, the SBI renders the functions of clearing house. Thus, it facilitates the inter bank settlements. Since, all the banks in such places have accounts with SBI; it is easy for the SBI, to act as clearing house. (5) Renders Promotional Functions: State Bank of India also renders various promotional functions. It provides various facilities to the following priority sectors: (i) Agriculture (ii) Small - Scale Industries (iii) Weaker sections of the society (iv) Co-operative sectors (v) Small - traders (vi) Unemployed Youth (vii) Others. In this respect SBI is like any other commercial bank. B. General Banking Functions Besides the above specialized functions, the SBI renders the following functions under Section 33 of the Act. 1. Accepting deposits from the public under current, savings, fixed and recurring deposit accounts. 2. Advancing and lending money and opening cash credits upon the security of stocks, securities, etc. 3. Drawing, accepting, discounting, buying and selling of bills of exchange and other negotiable instruments. 4. Investing funds, in specified kinds of securities. 5. Advancing and lending money to court of wards with the previous approval of State Government. 6. Issuing and circulating letters of credit. 7. Offering remittance facilities such as, demand drafts, mail transfers telegraphic transfers, etc.

8. Acting as administrator, executor, trustee or otherwise. 9. Selling and realizing the movable or immovable properties that come into the banks in satisfaction of claims. 10. Transacting pecuniary agency business on commission stocks. 11. Underwriting of the issue of authorized shares debentures, and other securities. (This function is done through subsidiaries now) 12. Buying and selling of gold and silver. 13. It operates Public Provident Fund Accounts for the general public. 14. It operates Non-Resident External Accounts and Foreign Currency Accounts. 15. Providing Factoring service (through subsidiaries). 16. Provides shipping finance. 17. Promotes Export through Export Credit. Provides Project Export Finance. 18. Provides Merchant Banking Facilities. 19. Provides specialized services like "Global Link Services ". 20. Promotes housing finance through "SBI Home Finance Ltd ". 21. Offers community services Banking. It provides grants to many socially relevant research projects undertaken by various universities and academic institutions in the country. 22. Provides Leasing Finance and Project Finance Facilities. 23. Participates in Lead Bank Scheme. 24. The State Bank may with the sanction of the Central Government, enter into negotiations for acquiring the business of any other Banking Institutions.

Aims

The aim of SBI & Loan is to award services for the growth and development of businesses & establishment and hence the development of the nation. Therefore, the website is committed to extend support for Business, Investment & Loan.

Objectives

The objectives have been put forward considering the most reliable and efficient activities in the field of Consultancy and Outsourcing with highly skilled personnel along with their tremendous efforts toward excellence in quality management has always been appreciated by Corporate houses, Statuitory bodies and Private parties. However, the objectives has been categorized and stated, considering the various phases of works in an enterprise, in the following manner for better understanding. Pre Operational Period Commissioning Period Operational Period The objectives are of basically an Extending support to the Enterpreneur in the Pre Operational Period for: Building documentation and sharing information of Legal aspects for Company Formation for the success of the Enterprising Legal objects for Proprietorship, Partnership, Private Ltd., Public Ltd. Preparation of documentation for obtaining Requisite permissions from competent Authorities. Building documentation and sharing information for Projects which involved Funding of the Projects. The Sources of Fund and the Application of Fund should be systematised for the success of the Project. The layout including information regarding selection, availabilty, for Capital Expenditure against viz. Plants & Machineries. The layout for Working Capital Expenditure against viz. Raw Materials, Recurring Expenditure, Contingency Expenditure etc. Extending support to the Enterpreneur in the Commissioning Period for: Sharing informations and establishing communications between Enterpreneur and the Vendors (Commodity or Service provider) for the proper utilisation of Inputs of Resources viz. Money, Machine, Material, Work force, Technology. Allocation of Financial Contribution from the Enterpreneur. Borrowings from Financial Institutions and others. Allocation of Fund and purchasing, Commissioning and Erection of Plant and Machineries and others under domain of Capital goods and Expenditure, viz. Plant, Machinery, Technology etc thereby. Allocation of Fund and purchasing of Raw Materials and others for Contingency

and recurring expenses including service and other contracts thereby. Allocation of Fund and Recruitments and others for Workforce. Extending support to the Enterpreneur in the Operational Period for: Sharing informations and establishing communications between Enterpreneur and the Vendors (Commodity or Service provider) for the proper utilisation of Inputs of Resources viz. Money, Machine, Material, Work force, Technology and the Expected Outputs thereby and. Allocation of Fund and Work in Progress for production according to the Project. Advertising for promotion of Sales. Establishing Marketing (Selling / Purchasing) Network of Commodity / Service. Recieving of Remuneration / Reward against providing Right Commodity / Service, in Right Time to the Right Customer. Administration and other Managerial Works for proper utilisation of Resources and for the success of Operating cycle in Business.

Mission Statement Sbi

Mission Statement Develop into a top rate, nimble footed banking institution committed to excellence inservices to its customers, enhancing stakeholders value though care andcompetence and fulfilling obligations to the community at large

What ails State Bank of India?

The biggest challenge before SBI, at this point, is monitoring its bad assets

SBI owns many of its 15,000 branches and a few thousand residential flats across the country, making it among the largest real-estate rich outfits, after defence, Indian Railways and LIC. Photo: Pradeep Gaur/Mint

For the past one year, the State Bank of India (SBI) has been showing a drop in both operating as well as net profits in every quarter and a rise in bad assets. Its gross non-performing assets (NPAs) rose to 5.73% of total loans in the December quarter, up from 4.75% in March; after setting aside money, the net NPAs have risen to 3.23% in December from 2.10% in March. What ails the nations largest lender? There are some cosmetic changes such as insurance cover for all export and small loans, airconditioning of all branches, and taming of the aggressive trade unions, but fundamentally nothing has changed in the bank. Its expenses have been on the rise while there is no commensurate rise in its incomeboth interest income as well as fees. There is also a structural issue that could be harming the bank. Following the recommendations of consultancy firm McKinsey and Co., SBI has de-layered its administrative structure. Its four managing directors looking after most of the banks

businesses and nine deputy managing directors report to the chairman. This makes the chairman an operational head with very little time for lateral thinking and strategy. Besides, through a change made about two-and-a-half years ago, the chairman is also now a member of SBIs asset liability management committee (Alco), which takes a call on deposit and loan rates. Since the chairman has the last word on such issues, ideally he should stay away from Alco meetings, allowing his colleagues to have frank discussions. Many in the bank believe that a sharp rise in the banks short-term deposit rates, done at the chairmans insistence, has affected its net interest income and consequently net interest margin, a key parameter of profitability. There are many ways that SBI can cut costs. For instance, it has 14 stationery departments to supply A4 size papers, ball pens, pins and clips to 14 circles of the bank. These departments employ several hundred workers. Does a bank need such a division when a Flipkart.com can take care of such needs? Similarly, it has 14 processing centres to scrutinize new depositors forms, employing at least a couple of thousand people. Its a mystery why SBI needs data processing centres for every circle when most foreign and new private banks run one centre to process such data across India. Yet another cost centre is the currency chests that SBI has historically been managing on behalf of the Reserve Bank of India. Of the 4,200 currency chests across India, SBI runs 2,200 or 52% of them while its market share in loans and deposits is around 17%. Assuming that each currency chest on average needs about six armed guards, more than 13,000 such armed guards are on the payroll of the bank. While cash management is a critical activity for the banker to the nation, surely there are modern cash replenishment and logistics alternatives that can minimize use of guards and space. Finally, SBI owns many of its 15,000 branches and a few thousand residential flats across the country, making it among the largest real-estate rich outfits, after defence, Indian Railways and Life
Insurance Corp. of India. What prevents it from floating a real estate arm, in partnership with a real

estate management firm? This will result in savings of several hundred crores every year through efficient negotiations with the landlords and free up resources for their core job of business development. Another area where the bank must look into is its 41,000-odd ATM network for the group. In November, the SBI group roughly accounted for 41% of the 380 million outstanding debit cards (and 45% of the total 530 million transactions) but its share in the ATM network was far less, at 30%. As a result, the banks customers use other banks ATMs for withdrawal of money. Under norms, up to five such transactions are free. While the customers make free transaction at other banks ATMs, SBI needs to payRs.18 per transaction. Indeed, SBI also makes some money while other banks customers use its ATMs but thats far less than what it pays to other banks. It possibly needs to take a look at the locations of its ATMs to increase the footfalls. It can also explore whether it can charge

on its ATM use. There are roughly 8 million ATM transactions a day and even if it charges Rs.1 per transaction, it can earn Rs.300 crore a year. The biggest challenge before the bank, at this point, is monitoring its bad assets, about 60% of which originate from mid-corporates and relatively large among the small and medium enterprises (SMEs), the companies which are not diversified, and another 25% from low-ticket accounts from retail, agriculture and small businesses. The bank must give up its traditional model of focusing on manual supervision which is almost impossible when one needs to track millions of accounts. Apparently, sometime back it had set up an account tracking and monitoring platform, called AT@M, for real time monitoring of stressed accounts, but it has not been put to proper use. As a result, even in tractor loans, the banks NPAs are in double digits. The bad asset monitoring should be entirely technology driven, supported by modern models of call centres and field tracking. Finally, the employees should be incentivized to take decisions. Currently, about 70% of SBIs 220,000 employees are backroom staff and only 30% face customers. This order must be reversed. In a modern bank, up to three-fourths of the employees are expected to be on the frontline. That will help the bank increase its business and income, both interest and fees. Note: This story has been updated from its original version to clarify the roles of the banks managing directors. Tamal Bandyopadhyay keeps a close eye on everything banking from his perch as Mints deputy managing editor in Mumbai. He is also the author ofA Bank for the Buck, a book on HDFC Bank

Shareholding & Liquidity (Till 30

th

Sept. 2007)
Reserve Bank of India is the largest

shareholder in the bank with 59.7% stake followed byoverseas investors including GDRs with 19.78% stake as on

September 06. Indian financialin stitutions held 12.3% while Indian public held just 8.2% of the stock. RBI is the monetaryauthorit

y and having majority shareholding reflects conflict of interest. Now the government isrectifying the above error by transferring

RBIs holding to itself. Post this, SBI will have a further headroo m to dilute the GOIs stake from 59.7% to 51.0%, which will further improve its

CARand Tier I ratio.

Key Areas of Operatio ns

The business operations of

SBI can be broadly classified into the key income generating areassuch as National Banking, Internat ional Banking,

Corporate Banking, & Treasury operations. 44

Shareholding & Liquidity (Till 30 th Sept. 2007) Reserve Bank of India is the largest shareholder in the bank with 59.7% stake followed byoverseas investors including GDRs with 19.78% stake as on September 06. Indian financialinstitutions held 12.3% while Indian public held just 8.2% of the stock. RBI is the monetaryauthority and having majority shareholding reflects conflict of interest. Now the government isrectifying the above error by transferring RBIs holding to itself. Post this, SBI will have a further headroom to dilute the GOIs stake from 59.7% to 51.0%, which will further improve its CAR and Tier I ratio.

and Tier I ratio.

Key Areas of Operations The business operations of SBI can be broadly classified into the key income generating areassuch as National Banking, International Banking, Corporate Banking, & Treasury operations. 44

What is the difference between sbi and other nationalized banks.?

State Bank of India (SBI) (NSE: SBIN, BSE: 500112, LSE: SBID) is the largest banking and financial services company in India by revenue, assets and market capitalisation. It is a state-owned corporation with its headquarters in Mumbai, Maharashtra. As of March 2012, it had assets of US$360 billion with over 13,577 outlets including 157 overseas branches and agents globally. The bank traces its ancestry to British India, through the Imperial Bank of India, to the founding in 1806 of the Bank of Calcutta, making it the oldest commercial bank in the Indian Subcontinent. Bank of Madras merged into the other two presidency banksBank of Calcutta and Bank of Bombayto form the Imperial Bank of India, which in turn became the State Bank of India. The Government of India nationalised the Imperial Bank of India in 1955, with the Reserve Bank of India taking a 60% stake, and renamed it the State Bank of India. In 2008, the government took over the stake held by the Reserve Bank of India. SBI has been ranked 285th in the Fortune Global 500 rankings of the world's biggest corporations for the year 2012.[1] SBI provides a range of banking products through its vast network of branches in India and overseas, including products aimed at non-resident Indians (NRIs). The State Bank Group, with over 18,324 branches, has the largest banking branch network in India. SBI has 14 local head offices situated at Chandigarh (Punjab & Haryana), Delhi, Lucknow (Uttar Pradesh), Patna (Bihar), Kolkata (West Bengal), Guwahati (North East Circle), Bhuwaneshwar (Orissa & Chattisghad)), Hyderabad (Andhra Pradesh), Chennai (Tamil Nadu), Trivandram (Keralam), Banglore (Karnataka), Mumbai (Maharashtra), Bhopal (Madhya Pradesh) & Ahmedabad (Gujarat) and 57 Zonal Offices that are located at important cities throughout the country. It also has 157 branches overseas. Nationalized Bank refers to Government Undertaking or Managing Bank. As SBI & PNB are Government Banks its a Nationalized Bank Nationalised Banks of India Nationalized banks have always contributed to boost up the economy of India and available in a large number. It is also known for offering expeditious service and understands the actual need of its customers. In India Nationalized banks have great dominance over private banks as it has fully authority to look after the function and policy of private banks. Imperial Bank was the first banks that was nationalized in 1955 and became famous as State Bank of India. After that many banks got the certification of nationalized bank. Some of these are State Bank of Tranvancore, State Bank of Indore, State Bank of Patiala, State Bank of Saurashtra and more. The nationalized banks were established with great purpose to make wide reach of banking function even in the rural area and offers great benefit for those who actually get deprived from such service. The nationalized banks are fully committed to offer the best possible service to its rural client and also make them aware about the various benefits, available for them. Such banks are fully dedicated to offer quality of service to their clients. In 1969, the total number of

nationalized banks was 14 whereas it became 21 in 1980. However State Bank of India became the topmost and the best commercial bank. Besides it also rated top five banks in the world. Presently there are 88 commercial banks and 27 banks are functioning in the country and established many branches to expand its service in all parts. Some of these banks have also established their branches in foreign countries as well. But the nationalised banks in India have its own reputation and operated with approximate 53,000 branches and 17,000 ATMs. By the coming of ATMs you can withdraw your money instantly and this service is available for 24 hours. Apart from that, the nationalized banks in India are also known for offering transparent service and provide crystal clear balance sheet in comparison with other banks. Moreover, it also replaced the old payment system and introduces the best system of payment by providing debit card and credit card. Earlier person used to carry cash while purchasing various items, but now you can easily make your payment by using such cards. Aside from offering such service, nationalized banks also introduced insurance policies such as life insurance health insurance. State banks of India has introduced many such polices to offer extra benefit to its customers. Besides, several other nationalized banks also offered such policies with better features. HOPE YOU WILL BE ABLE TO READ OUT THE WHOLE CONTENT AS THAT WILL ONLY PROVIDE THE EXACT INFORMATION YOU ARE WISHING FOR IT IS A BIT LENTHY