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    Revitalizing State Bank of India

    Uploaded by

    Pratyush Barua
    The document summarizes the history and current state of State Bank of India (SBI). SBI was formed in 1955 by merging several banks and is now majority owned by the Indian government. It has the largest network in India with over 22,000 branches and 58,000 ATMs. The document outlines SBI's subsidiaries, timeline of major events, corporate governance structure, and the vision of the former CEO to prioritize risk assessment, customer experience, and cross-departmental collaboration. Challenges include a mismatch in capital and liabilities due to long-term loans, rising non-performing assets, and retaining skilled employees. Future prospects include improved profitability through digital offerings and leveraging organizational changes.

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    Revitalizing State Bank of India

    Uploaded by

    Pratyush Barua
    79 views11 pages
    The document summarizes the history and current state of State Bank of India (SBI). SBI was formed in 1955 by merging several banks and is now majority owned by the Indian government. It has the largest network in India with over 22,000 branches and 58,000 ATMs. The document outlines SBI's subsidiaries, timeline of major events, corporate governance structure, and the vision of the former CEO to prioritize risk assessment, customer experience, and cross-departmental collaboration. Challenges include a mismatch in capital and liabilities due to long-term loans, rising non-performing assets, and retaining skilled employees. Future prospects include improved profitability through digital offerings and leveraging organizational changes.

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    The document summarizes the history and current state of State Bank of India (SBI). SBI was formed in 1955 by merging several banks and is now majority owned by the Indian government. It has the largest network in India with over 22,000 branches and 58,000 ATMs. The document outlines SBI's subsidiaries, timeline of major events, corporate governance structure, and the vision of the former CEO to prioritize risk assessment, customer experience, and cross-departmental collaboration. Challenges include a mismatch in capital and liabilities due to long-term loans, rising non-performing assets, and retaining skilled employees. Future prospects include improved profitability through digital offerings and leveraging organizational changes.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    79 views11 pages

    Revitalizing State Bank of India

    Uploaded by

    Pratyush Barua
    The document summarizes the history and current state of State Bank of India (SBI). SBI was formed in 1955 by merging several banks and is now majority owned by the Indian government. It has the largest network in India with over 22,000 branches and 58,000 ATMs. The document outlines SBI's subsidiaries, timeline of major events, corporate governance structure, and the vision of the former CEO to prioritize risk assessment, customer experience, and cross-departmental collaboration. Challenges include a mismatch in capital and liabilities due to long-term loans, rising non-performing assets, and retaining skilled employees. Future prospects include improved profitability through digital offerings and leveraging organizational changes.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 11

    Revitalizing State Bank of India

    Group 7:
    Maulik (027)
    Ridhima (041)
    Eashwar (138)
    Mithil (214)
    Charanjeet Brar (260)
    Himani (270)
    Vishal (308)
    INTRODUCTION : STATE BANK OF INDIA
     SBI is an Indian Multinational Bank which is predominantly owned by government of India
     The share of government in the bank was acquired from RBI in 2007 and stands at 60%
     SBI was formed post independence by merging other public sector banks (Bank of Calcutta, Bank of
    Bombay and Bank of Madras) which was initially named as Imperial Bank of India
     It is now headquartered in Mumbai and has a 23% market share by assets and 25% by loans and
    deposits.
     It is ranked 236th in Fortune 500 companies and is 43rd largest bank in the world.
     SBI has the largest network of Branches and ATMs in the country and has 145 foreign branches in 35
    countries.

    SBI SUBSIDIARIES AND JOINT VENTURES:


    1) SBI Capital Markets
    2) SBI Life Insurance 3) SBI Mutual Funds
    4) SBI Cards and Payment Services
    EVOLUTION OF SBI TIMELINE

    1921: Bank of Calcutta merged to form IBI

    1955: IBI becomes state owned; named SBI

    1990: Liberalization of Banking Sector; New


    Domestic Entrants such as HDFC, ICICI and
    foreign entrants like CITIBANK.

    2013: Becomes customer and innovation centric


    and starts adapting to change; adds new customer
    segments
    SBI CORPORATE GOVERNANCE STRUCTURE
    SBI CORPORATE GOVERNANCE STRUCTURE
    Objectives of SBI Corporate Governance
     To safeguard the interest of all stakeholders of the organization which are Customers, Employees and Society
     To ensure transparency and integrity in all banking transactions.
     To shield and enhance the shareholder worth

    SBI Corporate Governance:


     Bank has adhered to principles of corporate governance by having different persons for positions of CEO & Chairman.
     The frequency of meetings at the board level in SBI is higher than banks like ICICI Bank.
     The Bank is extremely committed to the corporate governance which is visible in the objectives and mission of bank namely transparency,
    integrity and accountability.
     The liquidity position of SBI is not recorded in sound manner

    SUGGESTIONS

     In order to improve the financial positions of SBI banks SBI should improve its liquidity by either increasing current assets or by reducing
    current liabilities.
    BHATTACHARYA’S VISION – A Three-Pronged Approach
    PRIORITIZATION OF RISK ASSESSMENT IN THE ORGANIZATION:
     Since there has been lapses and mismanagement in understanding and allocating risks; the underwriting standards were reviewed.
     Starting an early credit review process that required an independent auditor to review the credit decision of loans above certain threshold within
    six months of underwriting.

    RENEWED FOCUS ON CUSTOMER EXPERIENCE, SERVICE AND SATISFACTION:

     Transform SBI into an organization that continuously evolve, innovate and make competitive creative products
     Created easy-to-deliver and easy-to-understand products. Increased focus on making banking easier using digital means.

    PROMOTE COLLABORATION WITHIN DEPARTMENTS AND ACROSS SUBSIDIARIES:

     SBI successfully marketed personal accident insurance launched by it’s subsidiary SBI General Insurance to its customers.
     SBI General Insurance setup product helplines for the bank’s employees to get answers to their queries to promote healthcare schemes.
    Initial impact – first two years

    Risk Management Asset quality Communication

    • Established an early warning • Reorganized organizational • Use of webcasts and blogs to


    system(EWS) to flag potential structure and leveraged establish regular
    risks in individual accounts technology to safeguard communication with
    agricultural loans
    and using a dynamic rating • RBI allowed banks to raise 15
    employees
    process years infrastructure bonds to fund
    • Initiated mass internal
    • Benchmarked standard long term assets communication program
    operating procedures for • SBI started using carrot-stick called Aarohan and using
    every product and started policy for EMI payment on retail Aspirations, a social
    building data analytics team loans, but later resorted to networking site
    • Increased focus on companies auctioning assets as the initiative • Motivated employees by
    with good credit ratings and didn’t deliver promising results incorporating their suggestions
    retail loans
    Initial impact – first two years

    People focused Financial Inclusion Business growth

    • Introduced the e-learning • Transitioned from zero balance • Ensured collaboration among
    platform that has mandatory accounts to minimum initial different divisions to expand their
    modules for front-line staff balance by encouraging people reach to attract more customers
    • Synchronized employee’s goals • Additional revenue stream by • Continuously encouraged the
    with business targets by means of the financial inclusion by employees to achieve bigger
    proposing a new career charging a nominal fee for targets through collaborative
    development system account opening initiatives
    • Rewarding the best performing • Enhanced focus on creating easy • Launched seven digital branches
    employees with the overseas to deliver and easy to understand named sbiINTOUCH that are
    training opportunities products by leveraging technology operated by just two employees
    • Cross functional training of who help the customers
    employees across various roles
    and locations
    Bank’s Challenges

     Capital mismatch issues due to funding of long term loans with short term
    liabilities
     Agriculture loan portfolio is in grave condition
     Increase in non-performing assets and employee salaries
     Skill differences between experienced and new employees created a productivity
    mismatch
     Poor or substandard understanding of risk and its allocation
     Employee retention is getting difficult with time
     Absence of end to end credit process
    Recent happenings
     Bank is expecting a huge amount of loan slippages and restructuring of about Rs.60,000 crore in the
    current fiscal year of 2020-21
     Ifthe restructuring and slippages books slip into NPAs, the gross NPAs will shoot up, but the bank has
    two more quarters to make provisions against the doubtful loans
     NPA problem is invisible today as MSMEs, corporate and retail borrowers have been enjoying
    moratorium since March this year
     SBI General Insurance tied up with Mahindra Insurance to make stronger presence into tier 2 and tier 3
    cities
     SBI Card and BPCL jointly launch credit card offering benefits to customers having higher fuel expenses
     State Bank of India will hold a mega e-auction of properties on December 30, 2020
     SBI shelved VRS plan citing fear of key posts lying vacant

    Future Prospects
     Immense focus on improved profitability and better than ever digital offerings
     Leverage the huge potential in upcoming changes in the organizational structure
     Make the customer’s transactions and services ultra fast to gain competitive advantage
    Thank you

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