SBI buys 76% stake in Kenyan bank

State Bank of India (SBI)  today announced its second overseas acquisition. It bought a 76 per cent stake in Kenya-based GIRO Commercial Bank for about $7 million (Rs 31.08 crore).

The Kenyan bank, which is promoted by persons of Indian origin, has six branches in Nairobi, Mombassa and Kisumu.

In a statement, SBI said it has executed the necessary documents for acquiring the stake, along with management control, subject to regulatory approvals.

Earlier this year SBI had bought for $10 million a 51 per cent stake in Mauritius-based Indian Ocean International Bank, having a network of 10 branches and 10 ATMs.

SBI chairman A K Purwar said, "With the proposed acquisition, SBI would increase its footprint in Africa, where we are already present in four other countries."

This step would benefit not only the expatriate Indians but also facilitate trade and investment between the two countries, he added. As per banking sources, SBI is also going to bid for Rupali Bank of Bangladesh, for which it has already obtained permission from the RBI. It is in the process of acquiring two more banks with similar asset sizes ranging from $50 million to $200 million.

As part of its organic overseas expansion plans, SBI is setting up branches in South Korea, Shanghai and Angola. It has already established representative offices and branches in Sydney and Muscat.

The premier state-run bank is, in fact, rather upbeat in repositioning itself as a global bank.