IT spending to dip as SBI to shut down 47% of associate banks’ offices

atm-by-sbi-in-indiaEnterprise networking and software companies will face the music as SBI has decided to shut down almost half the offices of associate banks post merger.

SBI is merging five associate banks merge into it on April 1. SBI will shut down head offices of three associate banks and significant number of branches. This process of shutting down will start from April 24. The trimming exercise will result into reduction in IT budget.

SBI will retain only two out of the five head offices of the associate banks. Three head offices of the associate banks will be unbound along with 27 zonal offices, 81 regional offices and 11 network offices of the associate banks.

“From April 24, we will start dismantling the associate banks’ controlling offices, which includes head offices, regional offices, zonal offices and network offices,” said SBI Managing Director Dinesh Kumar Khara told IANS in an interview.

The five associate banks that will merge with SBI are: SBBJ (State Bank of Bikaner and Jaipur), SBM (State Bank of Mysore), SBT (State Bank of Travancore), SBP (State Bank of Patiala) and SBH (State Bank of Hyderabad).

There are currently 550 SBI offices while its associate banks have 259. The target for the number of controlling offices after the merger is 687 — a reduction of 122 offices.

SBI will redeploy 1,107 employees directly affected by these shutdowns.

There are about 5-7 people in every regional office and 20-odd people in each zonal office. One regional office controls 30-40 branches, while 4-5 regional offices are controlled by one zonal office.