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The sudden move by State Bank of India to merge its five associate banks with itself has taken the banking community and the unions by surprise and unnerved the 45,000-strong staff of the five banks.
“The decision was unusual and non-transparent, and it violated norms of good banking governance,” KS Krishna, general secretary of the State Sector Bank Employees Association, the common platform of the unions of the five banks,” told BusinessLine .
Most of the members of the boards of the five banks came to know of the move only when they showed up for the meetings, he said.
“They were kept in the dark about the SBI’s gameplan,” he alleged. “While the unions’ representatives on the boards and other independent members protested, others approved the SBI’s dictates.”
Krishna said the entire workforce of the associate banks is upset with the decision as they are now looking into an uncertain future.
“There might not be job loss immediately but definitely there will in future,” he said. He pointed out that these banks, which were among the oldest in the country, were deeply rooted in the local cultures of the princely States where they were set up and grown. Their local flavour and command of client loyalty were some of the key factors responsible for their success.
D Thomas Franco Rajendra Dev, President, All India State Bank Officers’ Federation, said, “The merger of the SBI associate banks with the parent will not take the country’s largest lender among the top 50 global banks.” He said the merger will lead to closure of several branches, going forward.
‘Must preserve identity’The five associate banks of State Bank of India have played an important role in the development of the respective States and their identity should be preserved, according to the All India Bank Officers’ Association.
S Nagarajan, General Secretary, AIBOA, said: “Due to SBI’s merger move, the underlying purpose of financial inclusion gets squarely defeated as branches will be closed down. Economic development of the respective States will also get affected.”
(With inputs from Mumbai, Coimbatore bureaus)
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