"What is needed in the system is variety," Rangarajan said.One of the possibilities is that large public sector banks (PSBs) like Punjab National Bank Canara Bank and Bank of India could try looking for potential candidates for acquisition, another official said, who did not wish to be identified.Factors like regional balance, geographical reach, financial burden and smooth human resource transition have to be looked into while taking a merger decision, they said, adding a very weak bank should not be merged with a strong one "as it could pull the latter down".In the last consolidation drive, five associate banks and Bharatiya Mahila Bank (BMB) became part of SBI on April 1, 2017, catapulting the country's largest lender to among the top 50 banks in the world. 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), besides BMB, were merged with SBI.With the merger, the total customer base of SBI reached around 37 crore with a branch network of around 24,000 and nearly 59,000 ATMs across the country. The merged entity began operation with deposit base of more than Rs 26 lakh crore and advances level of Rs 18.50 lakh crore.The government in February had approved the merger of these five associate banks with SBI. Later in March, the cabinet approved merger of BMB as well.SBI first merged State Bank of Saurashtra with itself in 2008. Two years later, State Bank of Indore was merged with it.

Source: Economic Times July 16, 2017 07:07 UTC