State Bank of India is an organisation "in transition" and will re-examine its staff strength only after "two or three years" once certain ongoing processes are completed, chairman A K Purwar said in Bangalore on Tuesday. He ruled out another round of VRS or alternative ways of reducing staff strength in the mean time.
Having carried out extensive computerisation, SBI is now implementing a core banking solution. Consultancy major McKinsey is also undertaking a detailed study of its business processes, which on reengineering, will have implications regarding staffing.
But there is unlikely to be any kind of delayering by way of doing away with zonal offices, Purwar clarified.
SBI is also going in for selling of non-banking products of group companies in life insurance and mutual funds. This will entail redeployment and retraining of staff.
The aim of the bank is to earn 15 per cent of its bottomline through cross-selling of non-banking products by 2007-08, Purwar added, seeking to play down the need to reduce staff after extensive computerisation.
As to where profits would come from once the foreseen "stable interest regime in the short and medium term" reduced profits from the sale of investments, the SBI chairman laid great store by lending to infrastructure.
He aimed to take outstandings on this account from last year's Rs 18,000 crore (Rs 180 billion) to Rs 28,000 (Rs 280 billion) in the current year. Another thrust area for increasing earnings is agriculture.
This assumes added importance in view of the current government's emphasis on revival of agriculture and generating additional jobs in it.
The bank had enough capital and retained earnings to both take care of Basel-II capital adequacy requirements and expand inorganically. SBI has been looking at Asia and Africa and is conducting due diligence on one bank. Purwar clarified this was not in the Indian subcontinent.
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