Impact of SBI's Merging on Recruitment and Staffing

Recent announcements by SBI (State Bank of India) regarding the merging of its subsidiaries have raised concerns and questions regarding the future of recruitment and staffing within the bank. This article aims to provide a comprehensive explanation of the potential impacts of SBI's mergers on recruitment and staffing.

Overview of SBI and Its Subsidiaries

State Bank of India (SBI) is the largest commercial bank in India with over 15,000 branches and over 220,000 employees. SBI owns five subsidiary banks: State Bank of Bikaner and Jaipur, State Bank of Travancore, State Bank of Mysore, State Bank of Hyderabad, and State Bank of Patiala. These subsidiaries operate strongly in their respective regions, summing up to over 7,000 branches and over 100,000 employees.

SBI has announced that it will merge all these subsidiaries. The merger is expected to increase SBI's net worth to around 37 billion and establish SBI as one of the top 50 banks in the world.

Impact on Branches

As a result of the merger, it is anticipated that all subsidiary branches will be converted into State Bank of India branches. This will lead to a consolidation of branches. According to preliminary estimates, 2500 branches will be either closed, relocated, or merged to optimize operations and reduce costs. This consolidation will significantly affect the number of branches required by the bank.

Impact on Staffing

Another major impact of the merger is the transfer of staff from the subsidiary banks to SBI. The subsidiary banks were regionally focused and had a strong presence in their home states. After the merger, staff from these subsidiaries are expected to undergo all-India transfers to consolidate operations under SBI. This move will require strategic relocation and integration of staff to leverage the strengths and optimize resources.

Surplus Staff in SBI Post-Merger

One of the critical concerns around the merger is the potential for excess staff. According to current estimates, the combined staff strength of SBI, including subsidiaries, will be around 3.25 lakh as of September 2017, and the number of branches is expected to be around 19,000. This scenario indicates that SBI is likely to have staff excess post-merger. Such a surplus means that the bank will need to manage excess personnel efficiently.

Impact on Recruitment

The impact of the merger on recruitment is multi-faceted. Madam Chairman of SBI has stated that the recruitment process for officers will continue, but clerical recruitment may be paused for a while. This decision is likely aimed at managing current staff resources effectively and ensuring efficient operations.

The merger and the resulting changes in staffing will likely affect new hiring for the next couple of years. However, there is some relief in sight as about 40% of the current workforce in SBI is scheduled to retire by 2021. This anticipated reduction in the workforce will leave room for future recruitment.

Overall, SBI's merger with its subsidiaries is expected to bring significant changes in the bank's operations and impact staffing and recruitment. While there will be challenges in managing excess staff and closing unnecessary branches, the long-term benefits of consolidation and optimization are significant for SBI and the banking sector as a whole.