The proposed merger of the State Bank of Indore with the parent State Bank of India is on as per the plan, but the merger of other associate banks has been put on hold, official sources said.
SBI initially had seven associates and with the merger of State Bank of Indore, the number would come down to five.
In August 2008, SBI had merged State Bank of Saurashtra with itself.
The sources said merger of other associate banks has been put on hold till further order.
Last month, SBI had announced its plans to merge its smallest associate, State Bank of Indore, after respective boards passed resolutions to this effect.
The announcement was opposed by bank unions who have threatened to go on strike.
The proposal for the merger of State Bank of Indore is subject to approval by RBI and the government.
The decision came a couple of weeks after Finance Minister Pranab Mukherjee asked public sector banks to look at consolidation as a serious option in order to reduce risks to financial stability and to face competition.