SBI merger may be delayed as banks yet to seek CCI approval

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26 Aug, 2025 12:21

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Moneycontrol Bureau

The merger of State Bank of India and its associate banks is likely to be delayed further as the PSUs are yet to receive approval from the Competition Commission of India (CCI). While the Union Cabinet had approved the merger last week, an RTI query by The Hindu revealed that the mandatory CCI clearance is yet to come.

Finance Minister Arun Jaitley on Wednesday said the Cabinet has approved the merger of the SBI and its five associate banks: State Bank of Bikaner and Jaipur (SBBJ), State Bank of Hyderabad (SBH), State Bank of Mysore (SBM), State Bank of Patiala (SBP) and State Bank of Travancore (SBT).

“The commission has not given permission for the takeover of subsidiary banks,” the paper reported on Wednesday quoting CCI’s reply to its RTI query.

It also said that these “five subsidiary banks have not sought permission from the CCI either individually or collectively for the takeover.”When the government had first approved the merger plan in June last year, SBI had hoped that it would complete the merger process in FY17 though last week, SBI Chairman Arundhati Bhattacharya had said the merger is likely to be completed in FY18. She refrained from being more specific.

The merged entity will create a banking behemoth, one-fourth of market share in India’s banking sector (in terms of loans and deposits), with an asset base of about Rs 32 lakh crore from about Rs 23 lakh crore. This is one-fifth the size of India’s gross domestic product (GDP) and more than five times the balance sheet size of ICICI Bank — India’s largest private lender.

“The merger is likely to result in recurring savings, estimated at more than Rs 1,000 crore in the first year, through a combination of enhanced operational efficiency and reduced cost of funds,” Union Cabinet said in its notification.

The merger will boost the number of employees by further 64,000 employees of the subsidiaries making total employee strength of nearly 2.71 lakh from 2 lakh people across 23,899 branches. At present, SBI has about 18,000 branches, including 200 foreign offices spread across 36 countries, and about 62,900 ATMs.