Sbi To Picks 51% In Gold Assaying Arm

The foreign partner Credit Suisse First Boston will hold 26 per cent in the company, while the balance 23 per cent will be held by other public sector banks.

This was stated by SBI chairman G G Vaidya at the bank's 45th annual general meeting yesterday.

Vaidya also said that the bank has already "entered into strategic alliances with key service providers of international repute" and the effort is towards being a "worldclass supermarket of financial services in the foreseeable future".

E-commerce initiatives: SBI is planning to make forays into e-commerce and e-trading, offer powerful data warehousing facility and data mining techniques, Vaidya said. The bank also plans to provide electronic payment gateway. It has appointed KPMG as their information technology consultant and the IT plan to finalise business solution is expected to be ready by September 2000.

 

Merger of associates: The bank is seriously examining the possibility of merging its seven associate banks with itself. "We will soon discuss the issue with the trade unions. The SBI Act does not prohibit us from merging the associates with the parent," Vaidya said .

The issue of merger of the SBI associates has been hanging fire for quite sometime. McKinsey & Co, the global consultancy firm which drafted the blueprint for the recast of the country's largest commercial bank in 1995, had recommended merger of the associates with the parent bank.

Alternately, it also said the seven associate banks could be merged to form a large bank. However, the SBI has not taken any decision on this issue so far.

Insurance venture: The bank will announce the name of the overseas partner for its proposed insurance venture over the next four weeks. "We are awaiting the government notification allowing banks to enter the insurance business. As far as the insurance business is concerned, the main strength of the bank is its brand equity. The group has 110 million customer spread across 13,000 branches," Vaidya said.

Infotech plans: Focusing on the bank's infotech plans, the chairman said eight branches have already started net banking this month and 2100 branches will be networked by the end of this year. "We are also planning to integrate credit cards with the ATMs by December," Vaidya said adding, "In Net banking we might be a late beginner but we will catch up soon with the new private sector banks. Nobody will be better than the SBI in the next six-eight months."

US GAAP: Vaidya said that the bank is in the process of identifying a chartered account firm to undertake this exercise which is expected to be completed by December 2001. He said that since SBI has a network of 9,000 branches and its subsidiaries has about 4,000 branches, it will require several changes in the existing ways of functioning and also lead to a complete "change in management" and a thorough business process re-engineering.

Retail banking: Vaidya said that SBI is offering extended working hours in 1800 branches. The bank plans country wide networking of 400-500 ATMs, integration of credit card system with ATMs and introduce Internet banking at all NRI branches. Networking of 300-400 computerised branches in metro and urban areas will be completed by March 2001.

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...autonomy must

The chairman of SBI G G Vaidya said that public sector banks should be given the autonomy in order to meet the competition from foreign as well as new generation private banks. He said that flexibility and freedom need to be given to recruit best of the professionals by offering them market relate d compensation. He also felt that a serious thought need to be given to freeing the public sector banks from the purview of central vigilance commission.