State Bank of India (SBI) will select a partner for a joint venture only after the Reserve Bank of India gives it clearance to venture into insurance sector.
Emphasising this, the new SBI chairman M P Radhakrishnan said, "The final view on tie-up for insurance sector will be taken only after the bank receives clearance from the government and the RBI. However, the bank is gearing itself in this sector so that we are prepared to meet the competition."
Recently SBI's board has cleared the proposal of floating a separate subsidiary in order to enter into insurance sector and is in the process of shorlisting a foreign partner. Earlier, former chairman , M S Verma, had indicated that the bank would be keen on venturing into both life and general insurance.
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Radhakrishnan has been the managing director and group executive (corporate banking) since mid-August 1997. Prior to this he had been the managing director at SBI Funds Management Ltd from April 1996 to June 1997.
The new chairman of SBI stated that the bank would focus on providing value-addition services, increasing the size of the balance sheet and provide better information technology services.
"State Bank will continue its effort on improving its recovery process and also work towards bringing down the level of non-performing assets as soon as possible," he said.
The banking sector is witnessing heavy competition due to lowering of spreads and SBI will leverage it capacity to meet this competition.
Radhakrishnan's appoint as the chairman of SBI come late Monday evening, the day when Verma was slated to retire. Radhakrishnan himself is slated to retire by January end and G G Vaidya, managing director at SBI, will then take over from him as the chairman of SBI. Vaidya will be the chairman till August 2000.
Radhakrishnan joined SBI in November 1959 as probationary assistant. He served chief general manager at Bhopal branch and also as chief executive of the bank at Bahrain office from August 1990 to September 1994. He is also a director on the board of SBI European Bank Plc and SBI (Canada), wholly owned subsidiaries of SBI.