SBI to keep associate bank consolidation plans on hold

Plans shelved diue to upcoming competition from new banks and transition to digital platform

State Bank of India (SBI) will keep the process of merging its associate banks on hold for some time to come as the country’s largest lender deals with upcoming competition from new banks and transition to the digital platform.

"Even if we merge them inside, my balance sheet will not go up, the group balance sheet remains the same (on consolidated basis). And therefore, the valuation I get will almost remain the same," SBI Chairman Arundhati Bhattacharya said on the sidelines of the launch of SBI's mobile wallet.

"Only thing that will happen is, I can bring about greater efficiency. But I can do that even without merging. Any roll-out which happens in the bank is picked up by associate banks as quickly as possible," she said.

"I don't think this is the right time. Because today there are lot of challenges and those challenges are more immediate and important than merging banks," the SBI chief said.

There are many challenges, such as conversion to digital at a fast pace, and payments banks on the horizon, she added.