SBI planning 15-20 acquisitions abroad

The largest public sector bank of the country, State bank of India (SBI) is actively looking at acquisitions overseas.

 "The rapid pace of overseas acquisitions we initiated last year will continue this year and the coming years as well and we are looking for acquiring at least 15-20 banks outside India in the next four-five years," A K Purwar, chairman of SBI, here to attend the State Bank of Mysore (SBM) annual general meeting said here on Saturday.

The bank has adopted a two-pronged strategy - expansion overseas without sacrificing domestic growth. "Our aim is to be among the top 50 banks of the world and top 5 banks of Asia in 4-5 years," Purwar said.

In FY06, SBI acquired a majority stake in three overseas banks in Mauritius, Indonesia and Kenya. Indicating that Asian and Africa are going to be the focus areas of the bank during future acquisitions, Purwar said the bank's Asian operations, especially in Bangladesh, Sri Lanka and Nepal were doing extremely well.

"We also plan to open an office in Pakistan as soon as we get permission from the government of India," Purwar said.

Domestically, SBI is well-positioned as the financial supermarket of the country - being the third-largest credit card company, the third-largest life insurance company, the second-largest merchant bank and the sixth-largest broking firm, Purwar said.

"Going forward, we are planning to enter the pension market in the near future and also the general insurance market, though not immediately," Purwar added.

About the huge difference between the credit and deposits growth, Purwar said, the credit growth of 29% was very huge. "But with the deposit growth of around 15-16%, there is the problem of generating resources. "So far we have been successful in generating resources, but how long that is going to continue is a question mark," Purwar added.

The interest rate at the moment looks stable and there is a comfortable liquidity in the market, Purwar said, adding: "The interest rates might see the double digit since there is an upward bias."