Aims at Rs 4,000 cr more of farm lending

State Bank of India (SBI) is looking at Rs 4,000 crore incremental growth in agricultural lending for this financial year.

This would be higher than the 30 per cent increase which the Centre had directed to all PSU banks earlier this year. Chandan Bhattacharya, managing director of SBI, said agri business has been identified by the bank as one of the potential area of growth in days to come.

The bank is financing number of projects to support development of agri infrastructure like cold chain, storage facility, transportation. It is also financing 10 agri export zones (AEZs) in the country.

"In cold storage alone, we are financing 120 projects. With average lending of Rs 6-7 crore per project, the total outgo in this area alone in the region of Rs 650-700 crore," he added in the sidelines of an interactive session with Federation of Indian Export Organisations (FIEO).

On acquisitions, Bhattacharya said: "We are open to the idea of domestic acquisition. Active talks are going on at this moment." He said more than one proposals were being looked at by the bank. The acquisition would not be region specific as SBI has a pan India presence with over 14,000 branches along with its associated banks. "We will look at the quality and type of business and how that can add value to the bank," Bhattacharya added.

The development gains in significance with consolidation being the name of the game among all domestic PSU banks.

The success of Oriental Bank of Commerce (OBC) and Global Trust Bank (GTB) merger has sparked off even more hectic activities. However, the entry of country's largest bank in the arena could change the dynamics altogether.

Asked about the proposed international buyout, the MD said the bank was likely to acquire more than one outfit which could be from the US, Asia or Africa. "This is expected within three months," he said adding SBI has all the financial prowess to meet the fund the expansion plan.

However, the bank entirely ruled out the possibility of merger of SBI associate banks with itself. Moreover, there would be no merger among the associate banks as well.

"All the banks have strong regional presence. The local strength will be washed out if they are merged," Bhattacharya pointed out.

To synergise the operation among all the seven associated banks, SBI has undertaken what is called 'virtual merger' where people, process and practiced are being put into common platform.