SBI plans to list 2 of its RRBs

Reported by: |Updated: September 14, 2017

State Bank of India is proposing to list two of the 18 regional rural banks (RRBs) it sponsors. It has aligned with NABARD to finalize a proposal, which also includes merger of 5 RRBs in the north east and create one RRB. According to Dinesh Khara, MD, Associate Subsidiaries at SBI, the plan is to take Andhra Pradesh Grameena Vikas Bank (APGVB) and Saurashtra Gramin Bank (SGB) to the market as these banks are profitable, have a good network in rural and urban areas of their states, and can use this money for growth. APGVB made a net profit of Rs 352 crore in FY17, up from Rs 223 crore a year ago. SGB recorded a Rs 39 crore net profit, up from Rs 17 crore a year ago. Khara said the listing may take two years for completion. The central government, which owns 50% stake in RRBs, has enacted laws that allow these banks to raise capital from sources other than central and state governments and sponsor banks. The state governments concerned owns 15% share and sponsor banks 35 in the RRBs.