(Live Mint)
The government on Monday announced its decision to merge Bharatiya Mahila Bank (BMB) with State Bank of India (SBI) to ensure greater banking services outreach to more women at a faster pace. “The decision to merge BMB with SBI has been taken in view of the advantage of the large network of SBI among other things,” the finance ministry said.
In the three years since Bharatiya Mahila Bank was established, women have been extended loans of Rs192 crore by Bharatiya Mahila Bank and about Rs46,000 crore by SBI group. SBI has a wide reach of more than 20,000 branches and the lowest cost of funds among banks. Out of its 200,000 workforce, 22% are women. SBI group has 126 all-women branches across the country, while Bharatiya Mahila Bank has seven.
“The proportion of administrative and managerial cost in BMB is much higher to reach the same coverage. For the same cost, a much higher volume of loans to women could be given through SBI,” the statement said. “This merger will help SBI get paid capital worth Rs1,000 crore lying on the books of BMB,” said Karthik Srinivasan, senior vice-president, Icra Ltd.Bharatiya Mahila Bank had a loan book worth Rs620 crore and deposit base worth Rs927 crore at the end of March 2016.
