State Bank of India (SBI) chairman OP Bhatt anticipates Reserve Bank of India to hike cash reserve ratio (CRR) or the repo rate by 25 basis points in the forthcoming monetary policy to be announced on July 29.
?The regulator is not likely to relax the existing norms even if it does not tighten them further for the moment,? he said.
Commenting on the consolidation between SBI and its subsidiaries, he said, ?We expect all formalities related to the merger of SBI and State Bank of Saurashtra (SBS) to be completed before the calendar year-end. This first merger will act as a litmus test and also would be a learning experience for our group. Based upon this, we will decide on pace and sequencing of the merger of other SBI subsidiaries with the parent bank. As size is not the only parameter in deciding the sequencing of the merger, the next move need not be merging a small bank like State Bank of Indore with SBI.?
?If all seven subsidiaries of SBI were to merge among themselves, the combination would become the second largest bank in India. It reflects the strength we might acquire in future, if SBI-SBS merger proves to be a favorable experience for us,? he said.