The Central government has decided to merge the Bharatiya Mahila Bank (BMB) with the State Bank of India (SBI) so that women of the country can avail banking services in a better way.
"The decision has been taken in view of the advantage of the large network of SBI. The objectives of affordable credit to women as well as propagation of women-centric products need to be quickly achieved through a wider network and lower cost of funds," the Finance Ministry said in a statement.
The SBI has a large outreach of over 20,000 branches and lowest cost of funds in the sector. Out of the total workforce of around 2 lakh employees in SBI, 22 per cent are women.
"SBI group already has 126 exclusive all-women branches across the country while BMB has only seven. The proportion of administrative and managerial cost in BMB is much higher to reach the same coverage. For the same cost, a much higher volume of loans to women could be given through SBI," it said.
The BMB, which was set up in 2013, has 103 branches across the country. As per a report, the total business of the bank is around Rs.1,600 crore, out of which Rs.1,000 crore is that of deposits and Rs.600 crore for advances. As per the bank’s website, the majority is retail business. In the meantime, the integration process of all five associates with SBI would begin from 1 April as a part of the consolidation exercise.
As per reports, the assets of State Bank of Mysore (SBM), State Bank of Bikaner and Jaipur (SBBJ), State Bank of Patiala (SBP), State Bank of Travancore (SBT) and State Bank of Hyderabad (SBH) will be transferred to the SBI and will function as its branches.
Last week, SBI said it would increase its stake in its two credit card joint ventures with General Electric Company to 74 per cent. Its board has already given a green signal to infuse Rs 1,160 crore in the two JVs ~ SBI Cards and Payment Services Pvt Ltd (SBICPSL) and GE Capital Business Processes Management Services Ltd (GECBPMSL).