The board of State Bank of India (SBI) has given the go-ahead to the proposed merger of the bank with its five associate banks and Bharatiya Mahila Bank (BMB).
The merger was cleared by India’s union cabinet in June 2016. The associate lenders that will be merged into SBI are the State Bank of Bikaner and Jaipur, State Bank of Travancore, State Bank of Patiala, State Bank of Mysore and State Bank of Hyderabad.
SBI has now cleared the share swap ratio for the merger of State Bank of Bikaner and Jaipur, State Bank of Mysore, State Bank of Travancore, and BMB.
Under the arrangement, shareholders of State Bank of Bikaner and Jaipur will receive 28 shares of SBI for every 10 shares held.
State Bank of Mysore and State Bank of Travancore shareholders will receive 22 SBI shares for every 10 shares held.
BMB shareholders will receive 4.42 crore shares of SBI for every 100 crore shares held.
The deal is now subject to approval by the Reserve Bank of India and the central government.