Saturday, November 14, 2009

SBT: Of Keralites, By Keralites, But Not For Keralites?



State Bank of Travancore is Kerala’s official bank if there is any such designation. It was created by eminent Keralites, and still thrives on Kerala’s huge NRI and domestic deposits. But when it comes to loans, SBT prefers to help corporates outside the state, often through big-ticket loan syndications. Ditto is the case with the bank’s customer service – winning accolades outside the state, and drawing flak inside Kerala. Is it something wrong with State Bank of Travancore or something wrong with Keralites? Are they expecting too much from their own bank?


Kerala headquartered SBT is not only a worthy child of the State Bank family. It is also a worthy adult with a mind of its own. Mergers are not something for State Bank of Travancore, which has taken into its fold not less than 10 banks during its 64 years of existence.

But this time, things would be different, no doubt, as it would be SBT which would be taken in by its parent since 1960, State Bank of India. But that merger is still far off, as SBI has prioritized the takeover of smaller, unlisted, and less healthy group banks than State Bank of Travancore like State Bank of Indore, State Bank of Hyderabad, and State Bank of Patiala.

SBT on the other hand is a listed entity, and has the unique credentials of never failing to make a profit and never failing to deliver dividends in its history.

But FY 2008-09 and the present year should be exceptions, anyone will agree. But at SBT, there is no need for such exceptions. For 2008-09, State Bank of Travancore registered a rise in net profit of 57.43% and a dividend payout of 130%. It was a record, and it clearly showed the bank team and its leadership could effectively rise up to the challenges.

And in 2009-10, this momentum only continues to gather steam with SBT posting a 337% rise in Q1 YoY.

SBT’s Managing Director AK Jagannathan is a veteran of the State Bank Group, having worked in State Bank of Mysore, State Bank of Hyderabad, & State Bank of Patiala, before taking up the assignment of Chief General Manager of State Bank of Travancore in October 2008 and later as its Managing Director. He is the perfect complimentary partner to SBI’s & State Bank Group’s Chairman OP Bhatt. Incidentally, Bhatt was the MD of SBT before moving to SBI in 2006.

State Bank of Travancore is known for its support for sensitive sectors, and was recently noted for surpassing its targets in delivering loans to farmers. At the same time, it caters to the diverse needs of its modern customer base. Recetly SBT tied up with Sundaram BNP Paribas to deliver their mutual funds through SBT branches.

State Bank of Travancore is a full service bank complete with core banking, internet banking, mobile banking, ATMs, home loans, vehicle loans, multi-city cheques, online tickets / bill payments, 3-in-one savings / demat / trading accounts, e-Tax, microfinance, MSME financing, reverse mortgages, and international credit / debit cards.

Owing to its presence in Kerala, SBT also has one of the most extensive NRI and Forex services in the country.

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