Indian parliament has passed the bill involving the merger of six State Bank of India (SBI) subsidiaries with the parent company.
The two houses of the parliament, Lok Sabha and Rajya Sabha, passed the State Banks (Repeal and Amendment) Bill, 2017, repealing the earlier laws of State Bank of India (Subsidiary Banks) Act, 1959, and State Bank of Hyderabad Act, 1956.
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The new law also amends the State Bank of India (SBI) Act, 1955.
The bill was introduced and passed in the lower house of the parliament (Lok Sabha) last year, while the upper house cleared the bill this week.
Under the merger process, the State Bank of Bikaner and Jaipur, State Bank of Mysore, State Bank of Patiala, State Bank of Travancore, State Bank of Hyderabad and the State Bank of Patiala will be acquired by SBI.
The merger received in-principle approval from the union cabinet in August last year.
State Bank of Hyderabad and the State Bank of Patiala were wholly owned subsidiaries of the parent company, while SBI holds 90% stake in the State Bank of Mysore, 75.07% in the State Bank of Bikaner and Jaipur and 79.09% in the State Bank of Travancore.
The merger is expected to facilitate operations and help SBI to achieve better profits reducing costs and through optimisation of resources.
