After losing out market share to competitors, India’s PSU bank is slowly becoming a one-stop financial shop. By asif ahmed
Under Purwar’s chairmanship, SBI acquired three small banks - Indonesia’s PT Bank IndoMonex, Mauritius-based Indian Ocean International Bank and Kenya’s Giro Commercial Bank. As a part of the overseas-driven strategy, SBI focused on developing foreign market that had substantial Indian population. During his tenure, SBI also made it to the coveted list of Fortune Global 500 list; he made the bank a member of the $1 billion revenues club, and was the first Indian bank to join it.
Bhatt comes from a different school, and thinks differently. According to him, the domestic market still offers immense opportunities to expand, and there are far more critical issues to be dealt with. “Overseas acquisitions can wait,” he said the day he took over as the chairman of SBI. However, Purwar’s legacy still lingers around. For example, during Bhatt’s time, SBI became the first Indian bank to open a fully-fledged branch in China. “Being India’s largest bank, it is only befitting that SBI should be the first to open a branch in mainland China,’’ said Bhatt. But this isn’t a focus area.
Keeping in line with the local mindset, Bhatt expanded the bank’s network in India. He tied up with other banks and institutions to cross-sell banking and financial products. S. K. Mishra, General Manager (Marketing and Cross-Selling Department), State Bank of India, explains, “In the Indian financial markets, mutual funds are rapidly gaining ground among retail investors due to various advantages such as professional management, diversification, and liquidity. For us, the tie-up will open up opportunities to provide our vast client base with a wider choice of products to meet their diverse financial needs and give boost to our fee-based incomes.”
Over the next three years, SBI plans to offer more financial services products like general insurance, custodian services, venture funds, wealth management, and pension-fund management. Given its size, number of branches, and growing customers’ base, it will not be difficult for the bank to woo customers for the new products. At the same time, SBI is the only Indian bank to have got the approval to manage the government’s pension fund. That, in itself, will be a big boon to future revenues and profits.
Under Purwar’s chairmanship, SBI acquired three small banks - Indonesia’s PT Bank IndoMonex, Mauritius-based Indian Ocean International Bank and Kenya’s Giro Commercial Bank. As a part of the overseas-driven strategy, SBI focused on developing foreign market that had substantial Indian population. During his tenure, SBI also made it to the coveted list of Fortune Global 500 list; he made the bank a member of the $1 billion revenues club, and was the first Indian bank to join it.
Bhatt comes from a different school, and thinks differently. According to him, the domestic market still offers immense opportunities to expand, and there are far more critical issues to be dealt with. “Overseas acquisitions can wait,” he said the day he took over as the chairman of SBI. However, Purwar’s legacy still lingers around. For example, during Bhatt’s time, SBI became the first Indian bank to open a fully-fledged branch in China. “Being India’s largest bank, it is only befitting that SBI should be the first to open a branch in mainland China,’’ said Bhatt. But this isn’t a focus area.
Keeping in line with the local mindset, Bhatt expanded the bank’s network in India. He tied up with other banks and institutions to cross-sell banking and financial products. S. K. Mishra, General Manager (Marketing and Cross-Selling Department), State Bank of India, explains, “In the Indian financial markets, mutual funds are rapidly gaining ground among retail investors due to various advantages such as professional management, diversification, and liquidity. For us, the tie-up will open up opportunities to provide our vast client base with a wider choice of products to meet their diverse financial needs and give boost to our fee-based incomes.”
Over the next three years, SBI plans to offer more financial services products like general insurance, custodian services, venture funds, wealth management, and pension-fund management. Given its size, number of branches, and growing customers’ base, it will not be difficult for the bank to woo customers for the new products. At the same time, SBI is the only Indian bank to have got the approval to manage the government’s pension fund. That, in itself, will be a big boon to future revenues and profits.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
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