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The merger of associate banks with State Bank of India may be a ‘win-win’ for both in terms of business, but it will mark the end of the ‘princely’ heritage in banking. The associate banks were founded before Independence and are entwined in local cultures.
The Cabinet on Wednesday approved a proposal by the SBI to merge five of its associate banks with itself.
Telangana will soon bid farewell to its one and only bank with local roots, the State Bank of Hyderabad (SBH).
Incidentally, the erstwhile central bank of the State of Hyderabad, which was set up in April 1942, entered its platinum jubilee year in April this year and has lined up year-long celebrations. This may now have to be cut short as the bank will soon become history.
Its Managing Director Santanu Mukherjee said the growth of SBH’s total business to over ₹2.5-lakh crore has been synonymous with the rise of Hyderabad, and Telangana in general.
In the past, it had managed the Hyderabad currency, Osmania Sikka, and public debt, besides commercial banking in the State of Hyderabad. Later, it became a subsidiary of State Bank of India in 1959 and is now the largest associate bank of SBI.
After the merger, there will be operational changes in the State as State of Hyderabad is now the convenor of the State Level Bankers’ Committee. SBI will take over this role after completion of the merger.
Apart from State Bank of Hyderabad, others too had a tryst with the pre-Independence era. For instance, State Bank of Bikaner and Jaipur was set up in 1943-44.
State Bank of Mysore was set up as Bank of Mysore Ltd by M Visveswwrayya under the patronage of Mysore Maharaja Krisha Raja Wadiyar IV.
State Bank of Travancore was originally established as Travancore Bank Ltd in 1945 sponsored by the erstwhile princely State of Travancore.
The heritage of State Bank of Patiala dates back to 1917, when it was founded by Bhupinder Singh, Maharaja of the erstwhile Patiala State, with one branch by the name of Chowk Fort, Patiala.
It remains to be seen how customers will perceive this change of brand. However, some old-timers are not too happy.
“I am not aware of business advantages. But I like the idea of being an SBH customer for long and would like it to retain its name even if they merge the business,” M Koteswara Rao, a retired staffer of Osmania University, told BusinessLine at the SBH campus branch here.
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