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Rajendra S. Pai's Banking news Blog

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Sunday, January 10, 2010

Marathi and Kannada Test

हे मराठीत लिहित आहे आणि त्या साठी मला फार सा त्रास झाला नाही ಮತ್ತು ಇದ್ದನ್ನು ನಾನು ಈಗ ಕನ್ನಡದಲ್ಲಿ ಬರೆಯುತಿದ್ದೇನೆ ಆದರಿಂದ ಇದು ಹೇಗೆ ಕಾಣುತದೆ ಅಂತ ನೋಡ ಬೇಕು

हे काई आहे अणि याचसाठी मी काई करावे

majha kai jhala

Monday, August 15, 2005

Information on SBI related Mailing Lists

Hullo,  I have been running Banking and SBI related free mailing lists
since August 2000. Quite a few new mailing lists have been started that
have wide ranging content in Banking and SBI areas. I have already
shared information about joining these groups. I have also reduced the
mailing activity in my group to avoid duplication of mails. I am once
again reproducing the details of the other mailing lists. All interested
should switch over to these groups. My colleague and friend Sri.
Anup Sen, Chief Manager, SBI, STC, Salt Lake, Kolkata runs a very
useful SBI related mailing list at freelists.org. He sends a lot of
material useful that helps in keeping oneself informed as well as
preparing for promotional exams. Another colleague and friend, Sri.
Madhu Bhat, Chief Manager, SBI, IT-Networking, CC, Mumbai also maintains
an equally interesting mailing list. In addition to Banking related
material, there are many useful write-ups, quizzes, articles on related
areas contributed by volunteers. Membership of these group is open
only to SBI employees. I suggest that interested employees become
member of both the groups. For Anup Sen's group, may send him a
request directly to: anupsen@gmail.com with a cc to: anupsen@vsnl.in
and stcsaltlake@vsnl.com giving their name, designation and branch
address etc. As regards Madhusudhan Bhat's group membership, please
send him a request email to: madhu.bhat@sbi.co.in giving their name,
designation and branch address etc. Regards, R.S.Pai

Monday, July 11, 2005

Excellent mailing list on SBI and other related news

Dear All,  Sri. Madhu Bhat is maintaining an excellent mailing list on
SBI and other related news. He sends a daily capsule of news in MS-Word
format. Many interesting quizzes are also featured. He does all this
excellent work in his freetime. Sri. Bhat is currently posted as
Chief Manager, Networking Department, Corporate Centre, CBD Belapur,
Navi Mumbai. You may subscribe to his list by sending him a request
email. Please mail to madhu.bhat@sbi.co.in Regards, R.S. Pai

Boosting fee-based income— Allow banksto hard-sell priced services(Business Line)

Boosting fee-based income � Allow banks to hard-sell priced
services (Business Line) K. Vijayraghavan Various strategies can
be thought of to boost fee-based income. Perhaps, the ideal one will be
that where for every service in a bank there can be two different
channels; the faster and guaranteed one, which can be at a higher cost,
and the ordinary one, where no extra cost is involved. TO THE astute
reader of an organisation's balance-sheet, the quantum of income per se
is less important than its constituents. This is true of commercial
banks too. The purpose of this article is to draw attention to the trend
in the growth of income of banks and to some of its main
constituents. The income of scheduled commercial banks is broadly
classifiable into interest and non-interest income. The interest earned
on loans and advances, besides income from investments are interest
income. Non-interest income comprises fees, income from trading, and
foreign exchange operations. It also includes miscellaneous
income. In the current soft interest regime, growth of bank income
has witnessed a slowdown. In 2003-04, rate of growth of income of
scheduled commercial banks was 6.6 per cent, compared to 14 per cent,
the previous year. The total income in absolute terms increased from Rs
1,72,345.02 crore in 2002-03 to Rs 1,83,767.24 crore in 2003-04.
Interest accounts for 78 per cent of the income of scheduled commercial
banks. Under this head, income from loans and advances grew, in the same
period, from Rs 68,570.10 crore to Rs 70,050.92 crore � a 2.33 per
cent. Meanwhile, income from investments increased from Rs 62,411.17
crore to Rs 65,797.84 crore, or by 5.43 per cent. During 2002-03 and
2003-04, interest on loans and advances as percentage to interest income
remained constant, at 49 per cent. Income from investments as a
percentage of interest income, however, increased from 44.3 per cent,
during 2002-03, to 45.6 per cent, during 2003-04. The changing
constitution of banks' income is the result of sharp variation in their
asset pattern. Published data reveal that between 1997 and 2003,
investments recorded a compounded annual growth rate of 20.7 per cent,
while interest-earning advances increased only at a 18 per cent. Over
the years, investment of scheduled commercial banks in government
securities has increased massively. It went up from Rs 2,30,687 crore in
1999 to Rs 5,02,498 crore in 2003; the percentage of investment in
government securities to total investments increased from 69 per cent to
76 per cent. The Reserve Bank of India has conceded in the report on
Trend and Progress of Banking in India, 2002-03 that "the fall in the
interest income has been to a large extent compensated by the rise in
income from investments". The writing on the wall is clear: Banks
prefer to invest money in government securities than undertake lending
per se. Another issue to be examined is the composition of the
non-interest income. Fee-income, trading income from sale and
purchase of securities, forex-income and miscellaneous income account
for roughly 30 per cent, 49 per cent, 9 per cent and 12 per cent
respectively. Income from fees and commissions, which was 70-90 per cent
of non-interest income in 1991-92 declined to 25-30 per cent during
2003-04. Data show that the fee-based income of scheduled commercial
banks increased from Rs 10,594.54 crore in 2002-03 to Rs 11,825.01 crore
in 2003-04, that is, by 11.6 per cent. But trading income went up
from Rs 13,211crore to Rs19,532 crore � 48 per cent � during the same
period. Analysts say that by keeping large chunk of their resources in
government securities, banks have indirectly and silently become a
conduit in raising public debt. They also warn that "reckless"
investment in government securities can result in complacency among
banks because it is a risk-free operation and involves no appraisal or
supervision after investment (post-credit supervision), as in the case
of advances. In the long run, they add, this might result in erosion
of appraising ability and supervising acumen in banks. Prima facie,
this view may sound a little far-fetched; nevertheless, the warning
needs to be heeded to and the decline in the growth rate of fee-based
income arrested on a priority basis. Simultaneously, strategies to
boost fee-based income should be urgently devised. More so, because of
the near perfect competition in the interest rate scenario, which makes
it difficult for banks to earn more by charging higher interest on
loans. Interest on government securities has also come down over the
years. The correlation between fee-based income and quality of customer
service is quite high. Unmistakably, banks have to concentrate more on
providing better, faster and more efficient customer service. Any
service provided by banks has to earn the satisfaction of the customer �
the ultimate judge of quality. Nevertheless, the close relationship
between service and customer is more relevant in the case of services,
which reach the larger cross-section of public. In this context,
fee-based income assumes greater significance because the clientele is
broader. Better and faster customer service will entail more cost to
banks and, under the current dispensation, their capacity to absorb
additional cost is quite limited. It would, therefore, be in the fitness
of things to permit banks to charge higher rates for better and faster
service. Various strategies can be thought of to boost fee-based
income. Perhaps, the ideal situation will be one where for every service
in a bank there can be two different channels; the faster and guaranteed
one, which can be at a higher cost, and the ordinary one, where no extra
cost is involved. Guarantee is important because many instances have
to come to light when people were made to run from pillar to post when
money was sent but did not reach the destination. Banks could consider
taking instructions on telephone or e-mail for issue of drafts and have
them delivered to the customer. People who want such quality services
will be ready to pay more. If this view is accepted, it may not be
necessary for the Indian Banks Association to prescribe service charges.
Competition and quality of service will take care of the pricing
mechanism. It may not be possible for banks to provide two service
channels everywhere, but a beginning can be made. Bank marketing has
to go beyond loans and deposits. Banks should seriously consider
launching aggressive marketing of specially priced services. For
example, people who purchase a large number of drafts in a month and
frequently make remittances can be given concessions. This approach can
be considered for other channels of services also. There is, however, a
rider to focusing on non-interest income. The RBI has quoted
international studies that caution against over-dependence on
non-interest income because of its volatility. It would be reasonable
to assume that the risk of volatility applies more to trading and
treasury income. This is because trading income derived from buying and
selling of securities and treasury income earned mainly from lending in
the call money market, are subject to unpredictable variations. On
the other hand, as the economy grows, the demand for fee-based services
of banks services is certain to go up. Hence, initiating
well-thought-out steps to enhance fee-based income may not be fraught
with risk. (The author is a former chief general manager, Reserve
Bank of India.)

Thursday, June 23, 2005

Inspiring speech by Steve Jobs, CEO Apple and Pixar at Stanford University Graduate Commencement

Dear All,
 
Steve Jobs, CEO of Apple Computers delivered this highly inspiring and touching speech at the Graduate Commencement of Stanford University on June 12 2005.
 
 I am sure you too will feel inspired after reading it.
 
Regards,
R.S. Pai
 
--------------------------------------------------------------------
 
I am honored to be with you today at your commencement from one of the finest universities in the world. I never graduated from college. Truth be told, this is the closest I've ever gotten to a college graduation. Today I want to tell you three stories from my life. That's it. No big deal. Just three stories.
The first story is about connecting the dots.

I dropped out of Reed College after the first 6 months, but then stayed around as a drop-in for another 18 months or so before I really quit. So why did I drop out?

It started before I was born. My biological mother was a young, unwed college graduate student, and she decided to put me up for adoption. She felt very strongly that I should be adopted by college graduates, so everything was all set for me to be adopted at birth by a lawyer and his wife. Except that when I popped out they decided at the last minute that they really wanted a girl. So my parents, who were on a waiting list, got a call in the middle of the night asking: "We have an unexpected baby boy; do you want him?" They said: "Of course." My biological mother later found out that my mother had never graduated from college and that my father had never graduated from high school. She refused to sign the final adoption papers. She only relented a few months later when my parents promised that I would someday go to college.

And 17 years later I did go to college. But I naively chose a college that was almost as expensive as Stanford, and all of my working-class parents' savings were being spent on my college tuition. After six months, I couldn't see the value in it. I had no idea what I wanted to do with my life and no idea how college was going to help me figure it out. And here I was spending all of the money my parents had saved their entire life. So I decided to drop out and trust that it would all work out OK. It was pretty scary at the time, but looking back it was one of the best decisions I ever made. The minute I dropped out I could stop taking the required classes that didn't interest me, and begin dropping in on the ones that looked interesting.

It wasn't all romantic. I didn't have a dorm room, so I slept on the floor in friends' rooms, I returned coke bottles for the 5� deposits to buy food with, and I would walk the 7 miles across town every Sunday night to get one good meal a week at the Hare Krishna temple. I loved it. And much of what I stumbled into by following my curiosity and intuition turned out to be priceless later on. Let me give you one example:

Reed College at that time offered perhaps the best calligraphy instruction in the country. Throughout the campus every poster, every label on every drawer, was beautifully hand calligraphed. Because I had dropped out and didn't have to take the normal classes, I decided to take a calligraphy class to learn how to do this. I learned about serif and san serif typefaces, about varying the amount of space between different letter combinations, about what makes great typography great. It was beautiful, historical, artistically subtle in a way that science can't capture, and I found it fascinating.

None of this had even a hope of any practical application in my life. But ten years later, when we were designing the first Macintosh computer, it all came back to me. And we designed it all into the Mac. It was the first computer with beautiful typography. If I had never dropped in on that single course in college, the Mac would have never had multiple typefaces or proportionally spaced fonts. And since Windows just copied the Mac, its likely that no personal computer would have them. If I had never dropped out, I would have never dropped in on this calligraphy class, and personal computers might not have the wonderful typography that they do. Of course it was impossible to connect the dots looking forward when I was in college. But it was very, very clear looking backwards ten years later.

Again, you can't connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something - your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life.

My second story is about love and loss.

I was lucky � I found what I loved to do early in life. Woz and I started Apple in my parents garage when I was 20. We worked hard, and in 10 years Apple had grown from just the two of us in a garage into a $2 billion company with over 4000 employees. We had just released our finest creation - the Macintosh - a year earlier, and I had just turned 30. And then I got fired. How can you get fired from a company you started? Well, as Apple grew we hired someone who I thought was very talented to run the company with me, and for the first year or so things went well. But then our visions of the future began to diverge and eventually we had a falling out. When we did, our Board of Directors sided with him. So at 30 I was out. And very publicly out. What had been the focus of my entire adult life was gone, and it was devastating.

I really didn't know what to do for a few months. I felt that I had let the previous generation of entrepreneurs down - that I had dropped the baton as it was being passed to me. I met with David Packard and Bob Noyce and tried to apologize for screwing up so badly. I was a very public failure, and I even thought about running away from the valley. But something slowly began to dawn on me � I still loved what I did. The turn of events at Apple had not changed that one bit. I had been rejected, but I was still in love. And so I decided to start over.

I didn't see it then, but it turned out that getting fired from Apple was the best thing that could have ever happened to me. The heaviness of being successful was replaced by the lightness of being a beginner again, less sure about everything. It freed me to enter one of the most creative periods of my life.

During the next five years, I started a company named NeXT, another company named Pixar, and fell in love with an amazing woman who would become my wife. Pixar went on to create the worlds first computer animated feature film, Toy Story, and is now the most successful animation studio in the world. In a remarkable turn of events, Apple bought NeXT, I retuned to Apple, and the technology we developed at NeXT is at the heart of Apple's current renaissance. And Laurene and I have a wonderful family together.

I'm pretty sure none of this would have happened if I hadn't been fired from Apple. It was awful tasting medicine, but I guess the patient needed it. Sometimes life hits you in the head with a brick. Don't lose faith. I'm convinced that the only thing that kept me going was that I loved what I did. You've got to find what you love. And that is as true for your work as it is for your lovers. Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do. If you haven't found it yet, keep looking. Don't settle. As with all matters of the heart, you'll know when you find it. And, like any great relationship, it just gets better and better as the years roll on. So keep looking until you find it. Don't settle.

My third story is about death.

When I was 17, I read a quote that went something like: "If you live each day as if it was your last, someday you'll most certainly be right." It made an impression on me, and since then, for the past 33 years, I have looked in the mirror every morning and asked myself: "If today were the last day of my life, would I want to do what I am about to do today?" And whenever the answer has been "No" for too many days in a row, I know I need to change something.

Remembering that I'll be dead soon is the most important tool I've ever encountered to help me make the big choices in life. Because almost everything � all external expectations, all pride, all fear of embarrassment or failure - these things just fall away in the face of death, leaving only what is truly important. Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart.

About a year ago I was diagnosed with cancer. I had a scan at 7:30 in the morning, and it clearly showed a tumor on my pancreas. I didn't even know what a pancreas was. The doctors told me this was almost certainly a type of cancer that is incurable, and that I should expect to live no longer than three to six months. My doctor advised me to go home and get my affairs in order, which is doctor's code for prepare to die. It means to try to tell your kids everything you thought you'd have the next 10 years to tell them in just a few months. It means to make sure everything is buttoned up so that it will be as easy as possible for your family. It means to say your goodbyes.

I lived with that diagnosis all day. Later that evening I had a biopsy, where they stuck an endoscope down my throat, through my stomach and into my intestines, put a needle into my pancreas and got a few cells from the tumor. I was sedated, but my wife, who was there, told me that when they viewed the cells under a microscope the doctors started crying because it turned out to be a very rare form of pancreatic cancer that is curable with surgery. I had the surgery and I'm fine now.

This was the closest I've been to facing death, and I hope its the closest I get for a few more decades. Having lived through it, I can now say this to you with a bit more certainty than when death was a useful but purely intellectual concept:

No one wants to die. Even people who want to go to heaven don't want to die to get there. And yet death is the destination we all share. No one has ever escaped it. And that is as it should be, because Death is very likely the single best invention of Life. It is Life's change agent. It clears out the old to make way for the new. Right now the new is you, but someday not too long from now, you will gradually become the old and be cleared away. Sorry to be so dramatic, but it is quite true.

Your time is limited, so don't waste it living someone else's life. Don't be trapped by dogma - which is living with the results of other people's thinking. Don't let the noise of other's opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.

When I was young, there was an amazing publication called The Whole Earth Catalog, which was one of the bibles of my generation. It was created by a fellow named Stewart Brand not far from here in Menlo Park, and he brought it to life with his poetic touch. This was in the late 1960's, before personal computers and desktop publishing, so it was all made with typewriters, scissors, and polaroid cameras. It was sort of like Google in paperback form, 35 years before Google came along: it was idealistic, and overflowing with neat tools and great notions.

Stewart and his team put out several issues of The Whole Earth Catalog, and then when it had run its course, they put out a final issue. It was the mid-1970s, and I was your age. On the back cover of their final issue was a photograph of an early morning country road, the kind you might find yourself hitchhiking on if you were so adventurous. Beneath it were the words: "Stay Hungry. Stay Foolish." It was their farewell message as they signed off. Stay Hungry. Stay Foolish. And I have always wished that for myself. And now, as you graduate to begin anew, I wish that for you.

Stay Hungry. Stay Foolish.

Thank you all very much.



Thursday, June 16, 2005

Details of SBI Award staff agreement dt 16-06-2005

Dear All,   Please visit   http://www.sbimspatel.com/pg1.htm  for
complete details of the agreement with Award Staff signed on
16-June-2005 Regards,

Monday, June 13, 2005

Tech initiative award bestowed on SBI (Business Line)

Tech initiative award bestowed on SBI  (Business Line)   MUMBAI: The
Banker, a magazine published by Financial Times Business Ltd, has
conferred two technology initiative awards on the State Bank of India
group for bringing its 14,000 plus inland and 52 plus foreign branches
on two separate core banking platfo rms and for its electronic
communication networking project. The awards have been won under the
categories of the "most outstanding core banking solutions of the year"
and "most outstanding outsourcing project of the year," the bank said in
a release here today (Friday). The SBI group has managed to bring
its 14,000 plus inland and 52 plus foreign branches on two separate core
banking platforms namely 'Bancs@24' of FNS being implemented by TCS Ltd,
and Finacle core banking solutions of Infosys. The group is also
running an electronic communication-networking project called SBI
Connect, which is being implemented by Datacraft India. SBI Connect,
which is a wholly owned private communication network of the group helps
the banks central data centre to communicate seamlessly with its
branches using data, voice and video. - PTI

Sunday, June 05, 2005

200 and still ticking: SBI celebrates its history (Economic Times)

200 and still ticking: SBI celebrates its history (Economic Times)
TIMES NEWS NETWORK[ SATURDAY, JUNE 04, 2005 12:26:25 AM]

MUMBAI: Big Daddy as it is called in the money markets turns 200 this week. The bicentennial celebrations of State Bank of India will be flagged off on Saturday at a function to be attended by Prime Minister Manmohan Singh and finance minister P Chidambaram.

From its inception in 1806, the bank has been a fund raiser for the various powers that ruled the country. As the Bank of Bengal in the early 19th century, it helped the East India Company stabilise interest rates and mobilise funds to expand the Company�s operations in India.

A 100 years later, under the British crown as the Imperial Bank of India, it acted as a quasi-central bank and gave effect to the government�s monetary policy. Post-independence, as SBI, the bank repeatedly rose to assist the government in times of foreign currency crises.

During the foreign currency crisis of the 1990s, the bank raised billions in dollars to pay for oil. When the Pokhran tests put off foreign investors in 1998, it raised $4.2bn. Once again in �00 the bank mobilised over $5bn to raise funds for growth.

Because of its size the bank is treated as a proxy for the Indian economy by foreign investors. With foreign financial markets opening up to Indian corporates, SBI is once again at an inflection point where it is reinventing itself as a retail lender.
 
 The bank�s first makeover happened in 1995 following McKinsey & Co�s recommendation of a flatter organisation with the creation of corporate offices for lending to large companies. The offices had huge lending limits and would report directly to the head office. Now, once again the bank is in the midst of a transformation to emerge as a technology-driven retail giant.

Says VN Nadkarni, who retired as chairman of the bank over two decades ago, �The strength of the bank was that systems were decentralised and there was great delegation of power.� According to Mr Nadkarni the biggest challenge in those days was to convince people to borrow as there was a stigma attached to borrowing. �

At that time, a borrower would commit suicide rather than default. But now it is the banker who has to commit suicide.�

DN Ghosh, chairman, who retired in 1989 and who marked SBI entry�s into investment banking with the launch of SBI Capital Markets and SBI Mutual Fund says that the main strength of SBI is its highly competent workforce. �During nationalisation of banks in India, most senior SBI officials were posted as chairmen to other banks� he says.

There were instances when politicians tried to use the bank for favours. Ex-chairman PG Kakodkar, during whose tenure the bank launched its Global Depository Receipts offering, had a unique way of dealing with such requests.

�I would ask them to fax me the request on the pretext that the phone line was not clear. After that, I would never receive any fax.� Mr Kakodkar also relates instances when the bank had to work around issues because of problems with unions.

�Computerisation had started in 1991, with the Backbay Reclamation branch being the first to be computerised. But due to opposition from unions the project had to be renamed Commercial & Institution Banking project.� Even transferring the forex department from Kolkata to Mumbai, where the markets were, took the bank 10 years. �

It was done in a subtle way with a namesake forex department being retained in Kolkata, which undertook only reconciliation work, while most of the forex business was shifted to Mumbai,� says Mr Kakodar.

MS Verma, who headed the bank during the Asian currency crisis and the panic selling which followed the Pokhran II tests in 1998 says that at that time, when there was a threat to isolate India, it was important to demonstrate that India could manage its own economy.

�SBI was the only bank which could raise this kind of money and deploy it in a manner that could cover its cost,� says Mr Verma. The bank ended up raising $4.3bn. According to Mr Verma the only handicap the bank has is the high average age of the organisation which means that training requirements would be different than those required for private banks.

The pressure of foreign exchange did not end when GG Vaidya took charge when the rupee was still under pressure and foreign investors were still wary. Yet the bank managed to raise $5bn in a span of two weeks. �The bank has the capacity to single-handedly deal with any transaction of any volume,� says Mr Vaidya.

According to him, there is an intertia in the bank when it comes to getting moving on new projects; This can be witnessed in the time taken to complete networking of branches. It was during Mr Vaidya�s tenure that a major attempt was made to resolve the issue of SBI�s seven associate banks.

Prior to independence, these were the apex banks at each of the independent princely states. Mr Vaidya had pushed for a merger of SBI with its associates and brought the bank to the brink of consolidation. However, his term came to an end before he could initiate merger proceedings.



SBI gets a birthday gift (Economic Times)

SBI gets a birthday gift (Economic Times)  TIMES NEWS NETWORK[ SUNDAY,
JUNE 05, 2005 12:30:38 AM] MUMBAI: As a gift on State Bank of
India�s 200th birthday, the government will review the �restrictions�
that hold back the country�s largest bank from raising money in the
capital market. Given the scale of capital required by SBI, the
government appears to be set to clear higher foreign shareholding in the
bank. Speaking at a function to mark the beginning of the bank�s
bicentennial celebrations finance minister P Chidambaram said that SBI
must expand globally to take India to the rest of the world. �I look
forward to seeing the SBI logo in every capital of every country,� said
Chidambaram At present, the Reserve Bank of India holds 59.73% in
SBI. The bank has headroom to issue further equity only until RBI�s
holding is down to 55%, which is the minimum prescribed under law.
Besides, the bank cannot raise capital overseas because it has a
foreign shareholding limit of 20% which has already been reached with
GDR holders accounting for 7.88% stake and foreign institutional
investors accounting for 11.9% stakes. However, if the government
raises the 20% limit for SBI in the next few months, there is a distinct
possibility that the foreign holding cap for nationalised banks, also at
20% will be reviewed. It is not clear at this stage whether the
government will also make it easier for the seven associate banks of SBI
to raise equity. At present the face value of shares of the associate
banks is Rs 100, and there is a restriction that no investor can hold
more 200 shares. Chances are that these restrictions would also be
re-examined. The finance minister said that SBI�s presence abroad
was also required to finance global trade, which was the engine of
growth and the opportunity for Indian companies to turn into
multinationals. �The initiative to expand into rural India and into
the world will require capital,� he said, adding that the government
will �re-examine all the current policies and restrictions� that come in
the way of SBI�s raising capital. Earlier speaking about the banking
sector, P Chidambaram said that banks would require capital to meet with
new capital adequacy requirement and provide credit required to fuel an
8% growth rate. The finance minister said that banks must also begin
to re-look at their concept as banks. �Banks cannot only sell banking
products. They have to start selling other products such as insurance,�
he said. Speaking at the function, Chidambaram set out an 8%
targeted growth rate for the economy. �The Indian economy can grow at
the rate of 5% even if there is no government. It can grow at 6% if
there are good monsoons and at 7% if there is a reasonable government
that does not interfere. It can grow at 8% if there is a proactive
government. That is the kind of government we want to offer,� said
Chidambaram. He added that an 8% rate of growth would require a huge
expansion in credit for which the banking sector will have to raise
capital.

200 years later, SBI looks overseas to fuel growth (Indian Express)

200 years later, SBI looks overseas to fuel growth (Indian Express) 
DEV CHATTERJEE         
 Posted online: Sunday, June 05, 2005 at 0029 hours IST
 
MUMBAI, JUNE 4: If you walk into the exhibition set up by State Bank of India at the National Centre of Performing Arts (NCPA) in Mumbai to celebrate its 200th birthday, don�t miss a typewritten yellow-coloured letter written by Tata Sons Chairman J.R.D. Tata in 1943 protesting 50 per cent reservation of jobs for Europeans.

��As an Indian I am completely against this reservation,�� said Tata � who was a member of the then Imperial Bank � as he sought equal opportunities for Indians.
 
As State Bank of India, which was constituted by an Act of Parliament in 1955 as the successor to the Imperial Bank of India, flags off its seeped-in-history bicentennial celebrations here today, JRD Tata would have been proud of what Indians managers have achieved over the last 58 years.

State Bank is today India�s largest bank with profits of over $1.13 billion (around Rs 5,000 crore) and a balance sheet footage of over $113 billion (Rs 5,00,000 crore).

It has been a long journey for the bank, which opened for business as Bank of Calcutta on June 2, 1806, as interest rates shot up and East India Company�s government wanted public credit.

Over the years, SBI has turned itself into a financial powerhouse and now looks beyond India to grow. ��I want the SBI not only to go deeper into rural areas but would like to see a State Bank of India logo in every capital of the world,�� Finance Minister P. Chidambaram set out the bank�s future agenda here today.

��The challenge of the future is daunting... �� warned Prime Minister, Manmohan Singh. ��Size does benefit but size alone does not guarantee success,�� the PM said.

No doubt the road ahead for SBI is getting more challenging. Take for example, SBI with its $1 billion profit is far lower than Citigroup�s profit of $17 billion and Bank of America�s $14 billion in December �04. The same year, HSBC reported a net profit of $11.8 billion.

Former chairman Dipankar Basu says the bank must adapt to change in order to survive. ��The challenges ahead are to attract and retain younger talent who can compete with foreign and private banks,�� says Basu. ��We have to look abroad for opportunities.��

SBI is planning a �Project Vijay� that will put it on the global banking map, as envisaged by the finance minister. �By 2008, SBI plans to rank itself among the top 50 global banks and among the top five in Asia,�� said SBI Chairman A.K. Purwar.