Money & Banking

State Bank of Hyderabad gears up for merger with SBI

| | Updated on: Apr 28, 2011




Employees eye additional benefits

State Bank of Hyderabad, the first subsidiary of State Bank of India, is gearing up for a merger with parent.

Expressing the intention for consolidation of the group, the SBI Chairman, Mr Pratip Chaudhuri, announced a couple of days ago that 100 per cent subsidiaries of the bank would be given priority in consolidation plans, fuelling speculation here that merger of State Bank of Hyderabad (SBH) is now imminent.

Earlier opposition

The proposal of merger with SBI is not new.

The proposal had witnessed strong opposition in 2008 from the then employees who argued about the need to protect the ‘historic' bank.

At times the ‘Telangana' identity of the bank was also sought to be safeguarded.


Things are now changed and the bank now is gearing up for merger in a ‘smooth' manner with the support of the officers and staff unions.

Mr P. Sudhakar, General Secretary, SBH Officers Association, and Joint General Secretary of All India Bank Officers Federation, told Business Line : “We welcome this announcement 101 per cent. More than 95 per cent of the officers and clerical staff are in favour of merger with SBI.”

SBH had about 6,000 officers and 6,500 clerical staff on its rolls.

Staff support

Apparently, the eligibility to get the benefits of pension, provident fund and gratuity are behind the support of the majority of the employees for the merger.

The staff of SBI's associate banks is eligible to receive either pension or provident fund and gratuity, unlike in SBI where all three benefits are given.

“For instance, I have nearly 40 years of service. In case there is a merger, employees like me will get over Rs 16 lakh as provident fund benefit from 1993 at the time of retirement,” Mr Sudhar said.


SBH is one of the strongest banks among the five associates of SBI with a business of over 1.50 lakh crore and a strong focus on technology-driven offerings.

Strong bank

“Unlike State Bank of Saurashtra and State Bank of Indore, which were merged with SBI earlier, SBH is a strong bank and will help SBI significantly to broad-base its strength further,” said a top SBI official.

Ms Renu Challu, Managing Director, SBH, said earlier that she had ‘nothing' to comment as the decision on merger rests at a different level.

Published on April 28, 2011

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