State Bank of India (SBI) is the largest bank in India. It is also, measured by the number of branch offices and employees, the second largest bank in the world. Established in 1806 as Bank of Bengal, it remains the oldest commercial bank in the Indian Subcontinent. It provides a range of banking products through its vast network in India and overseas, including products aimed at NRIs. With an asset base of $126 billion and its reach, it is a regional banking behemoth. The Government of India nationalised SBI in 1955 with the Reserve Bank of India having a 60% stake. SBI has laid emphasis on reducing the huge manpower through Golden handshake schemes and computerizing its operations. The Bank has also been trying to change the attitude of its largely rude staff through a programme called 'Parivartan' or 'Change'. The programme has not succeeded.
After a 20 year hiatus the Bank will be recruiting 20000 clerks and 3500 officers. The pick of the universities will be competing for these jobs. More than 2.4 million have applied. Those selected can aspire to rise to the level of Vice President
The roots of the State Bank of India rest in the first decade of 19th century, when the Bank of Calcutta, later renamed the Bank of Bengal, was established on 2 June 1806. The Bank of Bengal and two other Presidency banks, namely, the Bank of Bombay (incorporated on 15 April 1840) and the Bank of Madras (incorporated on 1 July 1843). All three Presidency banks were incorporated as joint stock companies, and were the result of the royal charters. These three banks received the exclusive right to issue paper currency in 1861 with the Paper Currency Act, a right they retained until the formation of the Reserve Bank of India. The Presidency banks amalgamated on 27 January 1921, and the reorganized banking entity took as its name Imperial Bank of India. The Imperial Bank of India continued to remain a joint stock company.
Pursuant to the provisions of the State Bank of India Act (1955), the Reserve Bank of India, which is India's central bank, acquired a controlling interest in the Imperial Bank of India. On 30 April 1955 the Imperial Bank of India became the State Bank of India.
In 1959 the Government passed the State Bank of India (Subsidiary Banks) Act, enabling the State Bank of India to take over eight former State-associated banks as its subsidiaries. On Sept 13, 2008, State Bank of Saurashtra, one of its Associate Banks, merged with State Bank of India. Employees were not in favour of the merger and had to be given generous sops by the Management. The manner in which the merger was done throws light on the weakness of the management vis a vis employee unions.
There are six associate banks that fall under SBI, and together these seven banks constitute the State Bank Group. All use the same logo of a blue keyhole and all the associates use the "State Bank of" name followed by the regional headquarters' name. Originally, the then seven banks that became the associate banks belonged to princely states until the government nationalized them in 1959. In tune with the first Five Year Plan, emphasizing the development of rural India, the government integrated these banks into State Bank of India to expand its rural outreach. There has been a proposal to merge all the associate banks into SBI to create a "mega bank" and streamline operations. The first step along these lines occurred in September 2008 when State Bank of Saurastra merged with State Bank of India. Employees were not in favour of the merger and had to be given generous sops by the Management. The manner in which the merger was done throws light on the weakness of the management vis a vis employee unions.
State Bank of India has often acted as guarantor to the Indian Government, most notably during Chandra Shekhar's tenure as Prime Minister of India. With more than 11500 branches and a further 6500+ associate bank branches, the SBI has extensive coverage. State Bank of India has electronically networked most of its metropolitan, urban and semi-urban branches under Core Banking System(CBS). The bank has one of the largest ATM networks in the region. More than 8500 ATMs across India. The State Bank of India has had steady growth over its history, though it was marred by the Harshad Mehta scam in 1992. In recent years, the bank has sought to expand its overseas operations by buying foreign banks. It is the only Indian bank to feature in the top 100 world banks in the Fortune Global 500 rating and various other rankings. According to the Forbes 2000 listing it tops all Indian companies.