SBI eyes 4 foreign banks for acquisition

State Bank of India (SBI) has initiated a due-diligence on four mid-sized banks overseas and would enter into negotiations for taking them over in the next three months.

The takeovers would depend on the due-diligence and SBI might end up acquiring all the four or less. The bank had set a target to double its global assets in two years to $26 billion, both organically and inorganically.

Acquisitions are also part of SBI's plan to expand its foreign operations to become one of the top three banks in Asia by 2008 and among the top 20 globally over the next few years. The bank has benchmarked HSBC's size in Asia to which it intends to grow over three years.

"We are evaluating four international banks currently and I cannot divulge any further information on this," managing director T S Bhattacharya said here today at the sidelines of the Banking Conclave, Organised by Ficci.

"These are mid-size banks with low manpower. SBI expects to complete the due-diligence over three months and thereafter the negotiations would commence," he added.

The bank had already taken over two overseas banks in Indonesia and Mauritius, Bhattacharya said.The takeover exercise is aimed at providing SBI the thrust to grow at a faster rate, which was not possible only through the organic route.

The bank, besides acquisition attempts, is also simultaneously moving ahead with strengthening its foreign network. It is going to open new branches in Angola and Shanghai.

At Shanghai, the bank is upgrading its representative office into a full-fledged branch.