Archive · 14 Nov 2025
SBI Chairman Expresses Support for Further Bank Mergers in India
The head of India's largest bank, State Bank of India (SBI), thinks it could be a good idea for some smaller government-owned banks to merge with bigger ones.
He believes this will help create stronger banks that can better support India's goal of becoming a developed country.
The government needs a lot of money to build new roads, factories, and other big projects.
SBI itself is very large, with many branches and customers, and it wants to grow even more.
While the banking market is competitive, SBI is looking to increase its share and doesn't see foreign banks as a major threat.
They are also supporting new rules that let banks directly fund companies buying other companies, but emphasize that the risks of each deal should be carefully considered.
SBI is also expanding its wealth management services to cater to growing demand.
SBI Chairman Challa Sreenivasulu Setty supports further mergers of smaller state-backed banks.
The mergers are seen as a way to build scale and finance India's growth and development goals.
SBI aims to further expand its market share and does not view foreign capital as a threat.
SBI is supporting a framework for banks to directly fund corporate takeovers, with pricing reflecting deal risks.
The bank is enhancing its wealth management services, hiring relationship managers and opening new wealth hubs.
- Who
- State Bank of India (SBI) Chairman Challa Sreenivasulu Setty
- What
- Expressed support for another wave of mergers among state-backed lenders to build scale and finance growth.
- When
- Interview published on November 14, 2025
- Where
- Mumbai, India
- Why
- To create larger state lenders, finance India's infrastructure and industrial projects, and support the goal of becoming a developed economy by 2047.
SBI's Perspective
Implicit Challenges
Need for Consolidation
SBI's Perspective
SBI Chairman believes further consolidation ('rationalisation') of smaller, sub-scale banks could be beneficial for the sector.
Implicit Challenges
While acknowledging the need for scale, the process of merging banks can be complex and may face operational challenges.
Competition and Market Share
SBI's Perspective
SBI aims to acquire more market share, even as a dominant player, and does not see foreign capital as a threat.
Implicit Challenges
Increased competition from both domestic and foreign players, and the concentration of large corporates, makes the corporate loan portfolio segment highly competitive.
M&A Financing
SBI's Perspective
Setty supports a framework for direct bank funding of corporate takeovers, but emphasizes that pricing should reflect distinct deal risks, expecting some softening due to increased competition.
Implicit Challenges
Ensuring no single bank has excessive exposure to M&A lending while managing risk-based pricing in a competitive environment presents a challenge.
- Bank
- State Bank of India (SBI)
- Chairman
- Challa Sreenivasulu Setty
- SBI's Market Share
- Approximately one quarter of India’s loan market
- Total Assets (SBI)
- $787 billion
- Total Assets (SBI, INR)
- Nearly ₹69 lakh crore
- Number of Branches
- Over 22,500
- Customer Base
- Over 500 million
- Projected Credit Growth
- 12% to 14% for the current year
