A Study of the Merger of SBI and Its Associate Banks: Its Probable Impact on the Banking Industry in India

The merger of the State Bank of India (SBI) with its associate banks represents a major consolidation reform in the Indian banking sector, aimed at improving efficiency, competitiveness, and financial stability. This study explores the rationale, process, and impact of the merger on the Indian banking industry, focusing on both financial and operational parameters. The research analyses pre- and post-merger performance indicators using secondary data obtained from the Reserve Bank of India (RBI), SBI annual reports, and financial publications. The results reveal that the merger enhanced SBI’s capital strength, market reach, and economies of scale while improving operational efficiency and profitability in the long term. However, challenges such as integration of human resources, technology synchronization, and short-term profitability decline were also observed. The paper concludes that the merger is a strategic step toward strengthening the Indian public sector banking system and achieving global banking standards.

SBI merger, associate banks, banking consolidation, Indian banking industry, operational efficiency, public sector banks, bank integration, economic reform

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