Two SBI associate banks to launch IPO

State Bank of Patiala (SBP) and State Bank of Hyderabad (SBH) have decided to enter the capital market within six months time.

The third among the SBI associates, State Bank of Saurashtra (SBS) has already announced its plans to go for IPO to take advantage of the booming capital market.

The State Bank of India (SBI) has 100 per cent holding in these three associates.

The rest of the associate banks that already have pubic holding, will go for further public offer again.

To augment the capital, all seven associates of SBI will raise fund from public within a year.

Among the three associates, SBP will be the first bank to go public followed by SBH and than SBS.

"State bank of Patiala is currently working on the plan and their IPO is expected by the end of first quarter. While IPO of SBH will be out in mid of the second quarter," said S K Singh, MD, SBS.

"Whereas, SBS, which is the smallest associate of SBI, will enter into capital market during the third quarter of the year," he added.

He further said SBS has yet to decide upon the size of the IPO.

"We are waiting for the amendment to the SBI Act is cleared," said Singh.

He added that the total business of SBS is worth Rs 22,214 crore at the end of March 2006.

Talking about the other four banks, Singh said State Bank of Indore, State Bank of Mysore, State Bank of Bikaner and State Bank of Trivancore already has public holdings.

"The SBI has holding of around 95 per cent in State Bank of Indore and the bank is planning to dilute more SBI holdings for public for which, it will raise fund in the current fiscal," said Singh.

Further, he added that the State Bank of Bikaner has public holdings of around 35 per cent and will too raise more funds.

Similarly, the other associate banks too need capital augmentation.

"So by the year end, all the seven associates of State bank of India will be raising more fund for expansion," said Singh.