Cabinet may discuss SBI-arm merger today

The Cabinet is likely to take up the issue of merging State Bank of India Commercial and International Bank Ltd (SBICI) with parent SBI tomorrow.

SBICI, a wholly owned subsidiary of SBI, functions as a private sector bank.

The board of SBI had cleared the merger in 2008. As of March 2011, the paid-up capital of subsidiary of SBI stood at Rs 100 crore while it earned a net profit of Rs 4.21 crore.

SBICI’s capital adequacy ratio (CAR) stood at 28.16 per cent at the end of March 2011.

SBI has already merged two of its associates namely State Bank of Saurashtra and State Bank of Indore since 2008.

SBI plans the consolidation of remaining five associate banks — State Bank of Bikaner and Jaipur, State Bank of Travancore, State Bank of Patiala, State Bank of Mysore and State Bank of Hyderabad.

The Cabinet is also expected to approve amendments to the Benami Transaction (Prohibition Act) to check black money. An official said the proposal would give the government the power to confiscate any property that is declared as benami, or held in the name of a person who has not paid the consideration for the property.