The Hindu Business Line : SBI Act amendment: Panel meeting next month

Chennai, July 24 A committee, formed for drafting the regulations arising out of the amendment to State Bank of India (Subsidiary Banks) Act, will meet at Jaipur on August 4 and 5, it is learnt.

The amendment was notified on July 9 and the regulations are being drafted now. One of the issues that the regulation will look at is dematerialisation of the shares of the banks.

Mr M. Ramaswamy, Chief General Manager, State Bank of Bikaner and Jaipur, told Business Line that at present no shareholder of the bank could hold more than 200 shares. The face value of each share is Rs 100. No demat has been done so far, because it is difficult to monitor the regulation if the shares are in dematerialised form.

But all that is bound to change with the amendment to the Act.

Stock split

Soon, the bank would split each share into 10 shares of Rs 10 each and then come out with a public issue, Mr Ramaswamy said. He was in Chennai in connection with the opening of a regional office in the city.

SBBJ is 75 per cent-owned by State Bank of India. Individual shareholders hold 12.73 per cent. Institutional holding in the bank is 6.97 per cent.

In 2006-07, the bank’s total business was Rs 49,000 crore and net profit Rs 306 crore. It has 844 branches, most of which are in Rajasthan.

The bank came out with a public issue in April 1997, at a price of Rs 540 a share, i.e., for a premium of Rs 440 a share.

SBBJ is one of the four subsidiaries of State Bank of India that have come out with a public issue — the others are State Bank of Indore, State Bank of Mysore and State Bank of Travancore.

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