It's curtains for Mahila Bank as government plots merger

If the merger with SBI happens, BMB will become the bank with the shortest life span of little less than 2 years
The move to merge the recently-floated only-women Bharatiya Mahila Bank (BMB) with the State Bank of India (SBI) may help save the government the cost of running a bank which may be duplicating the services offered by others.
Arundhati Bhattacharya, chairman of SBI, told dna that she has not received any official communication, adding that the merger, if happens, would have only a minimal impact.
If the merger goes through, BMB will become the bank with the shortest life span of little less than 2 years.
Bloomberg on Tuesday reported that the government may consider merging its state-run Bharatiya Mahila Bank with State Bank of India, the largest lender. The bank has 62 branches and about 400 of its employees are on deputation from other banks while about 150 officers are recruited fresh. If the government merges the bank into SBI, it will be the first merger in the public sector banking space."I have no official intimation. The bank has a very small footprint and about Rs 1,000 crore capital and about Rs 350 crore loan book. The bank has no non-performing assets and a return of assets of 1.3%. So a merger, if it happens, will have minimal impact," said Bhattacharya.
Brainchild of the former finance minister P Chidambaram, BMB has been allocated with an initial capital of Rs 1,000 crore, and started operations in August 2013. Under the UPA government, it had a major thrust to encourage women entrepreneurs. It has on its board Tanya Dubash, daughter of Adi Godrej, Renuka Ramnath, promoter of private equity fund Multiples, Kalpana Soroj, chairperson of Kamani Tubes, among others.
The bank already has a tie-up with SBI Cards and Payment Services, a subsidiary of SBI, for issuing while label credit cards to its customers.
Usha Ananthasubramanian, chairman and managing director of BMB, did not respond to the text messages sent to her by dna. She is former executive director of Punjab National Bank (PNB).
In her foreword to the 2013-14 annual report, Usha had said that though women constitute about half the population, they are under leveraged and that the Mahila Bank would bridge that gap. The bank was offering collateral free loans of up to Rs 1 crore to women entrepreneurs.
The bank, a specialised financial vehicle for economic empowerment of women, posted a total income of Rs 45.29 crore during 2013-14. The total business of the bank stood at Rs 175.17 crore at the end of March 2014.

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