SBI's sister banks prepare to offer VRS to employees

KOLKATA: State Bank of India (SBI) associate banks have started preparations to unveil voluntary retirement schemes (VRS) for their employees before the proposed merger with the parent bank.

State Bank of Hyderabad (SBH) board has approved the VRS while other associate banks will place the scheme before their boards in the next few days, according to two senior SBI group officials.

The VRS in associate banks would help SBI curb staff cost escalation after the merger. SBI's staff expense was Rs 6,853 crore in the September quarter, rising 11.6% year-on-year. SBI's pension obligation is estimated to be around Rs 3,500 crore. This would rise once associate bank employees come under SBI fold.


SBI has nearly 2.02 lakh employees while its associate banks have a cumulative headcount of 70,000. SBH, the largest among all the five associate banks, has around 18,000 employees. State Bank of Patiala has around 15,000.

Sources in the SBI said all associate bank staff opting for it would get similar benefits. A good chunk of them are likely to go for VRS as there has been apprehensions about their pecking order under SBI. Some senior officials have raised voices against the merger.

State Bank of Travancore chief general manager S Adikesavan was transferred to Hyderabad for reportedly questioning the merger. The government approved the merger in August while the exercise is likely to be over by March 2017.