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Blog maintained by : P. Radhamohan Nair, Retired Private Secretary to Post Master General, Northern Region, Calicut, Kerala Circle
Wednesday, May 18, 2016
New Delhi, May 17 (PTI) After over five years of hiatus, associate banks of SBI including State Bank of Bikaner and Jaipur have proposed to merger with the parent lender.
The respective boards have proposed merger with the State Bank of India (SBI), the parent, in a meeting held today, sources said.
The meeting of central board of SBI is going to consider the merger, they added.
Meanwhile, a section of employee unions have registered protest against any such move and threatened to go on a strike if such move is approved by the SBI and the government.
All employees of Associate Banks will go on strike on May 20, All India Bank Employees Association (AIBEA) General Secretary C H Venkatachalam said.
The country's largest lender has five associate banks -- State Bank of Bikaner and Jaipur, State Bank of Travancore, State Bank of Patiala, State Bank of Mysore and State Bank of Hyderabad.
Among these, State Bank of Bikaner and Jaipur, State Bank of Mysore and State Bank of Travancore are listed.
SBI first merged associate State Bank of Saurashtra with itself in 2008. Two years later in 2010, State Bank of Indore was merged.
The government recently set up the Bank Board Bureau (BBB) to look into the issues including consolidation in public sector banking space.
The BBB headed by former CAG Vinod Rai had conducted interview for appointments of Managing Directors of some of the banks where posts will be falling vacant during the current fiscal.
The Bureau was constituted to help the government select heads of public sector banks and financial institutions and assist banks in developing strategies with regard to capital-raising and consolidation.
Besides Chairman, the Bureau has three ex-officio members and an equal number of expert members.
Expert members are ICICI Bank's former joint MD H N Sinor, Bank of Baroda's former CMD Anil K Khandelwal and rating agency Crisil's ex-chief Rupa Kudwa.
Its ex-officio members are Secretary, Department of Public Enterprises, Financial Services Secretary and RBI Deputy Governor.
Non-resident Indians can no longer open a Sukanya Samriddhi Yojana (SSY) account. In fact, if your or your child's residential status changes to non-resident or she takes up another country's citizenship during the term of the scheme, no interest shall be paid from the date of citizenship or residential status changes and the account shall be considered closed.
A girl child would be eligible for an SSY account only if she is a resident Indian citizen when the account is opened, and remains so until maturity or closure of account. This new rule was clarified by a notification issued in March by the Finance Ministry.
As per the new rules , a change in residential status has to be reported by the parent/guardian within one month. In case the bank or post office is not notified and an interest is credited to the account after the change of resident status or citizenship, the earnings will be returned to the government and the balance returned to the SSY account holder.
A new clause has also been added for stricter penalties. Earlier, to regularise a default, where the account holder did not deposit the minimum yearly contribution of Rs 1,000, he was required to pay a penalty of Rs 50 for each year the condition was not met, along with the minimum contribution. Now, if the penalty is not paid, the entire deposit, including deposits made before date of default, will receive interest at post office savings bank account rate—currently 4%.If excess interest has been paid, it will be reversed. However, the long 15-year window to pay the penalty and make amends takes the sting out of this new rule.
Further, premature closures on grounds of medical exigencies, earlier allowed at any time during the term of the scheme, has been restricted. Now, this cannot be done unless the account has been functioning for at least five. If the holder wishes to withdraw before completion of five years, his investment will earn interest at the rate of a post office savings bank account.
The investing term of the SSY scheme has also been increased from 14 to 15 years. Also, now you can e-transfer your contributions.
Despite all these changes, the scheme still earns 8.6% return— higher than old-time favourites such as PPF , FD and recurring deposits. Plus, like PPF, SSY provides a tax benefit under Section 80C. For the conservative investor, with a daughter below 10 years of age, it continues to be the best debt instrument in the market today.
Source : The Economic Times