How it started
History
The roots of the State Bank of India lie in the first decade of the 19th century when the Bank of Calcutta (later renamed the Bank of Bengal) was established on 2 June 1806. The Bank of Bengal was one of three Presidency banks, the other two being the Bank of Bombay (est. 15-April-1840) and the Bank of Madras (est. 01-July-1843). All three Presidency banks were incorporated as joint stock companies and were the result of royal charters. These three banks received the exclusive right to issue paper currency till 1861 when, with the Paper Currency Act, the right was taken over by the Union of India. The Presidency banks amalgamated on 27-January-1921, and the re-organised banking entity took as its name Imperial Bank of India. The Imperial Bank of India remained a joint-stock company but without state participation.
Under the provisions of the State Bank of India Act, 1955, the Reserve Bank of India, which is India's central bank, acquired a controlling interest in the Imperial Bank of India. On 01-July-1955, the Imperial Bank of India became the State Bank of India. In 2008, the Union of India acquired the Reserve Bank of India's stake in SBI to remove any conflict of interest because the RBI is the country's banking regulatory authority.
In 1959, the state passed the State Bank of India (Subsidiary Banks) Act. This made eight banks that had belonged to princely states into subsidiaries of SBI. This was during the First Five-Year Plan, which prioritised the development of rural India. The state integrated these banks into the State Bank of India system to expand its rural outreach. In 1963, SBI merged the State Bank of Jaipur (est. 1943) and State Bank of Bikaner (est. 1944).
SBI has acquired local banks in rescues. The first was the Bank of Bihar (est. 1911), which SBI acquired in 1969, together with its 28 branches. The next year, SBI acquired the National Bank of Lahore (est. 1942), which had 24 branches. Five years later, in 1975, SBI acquired Krishnaram Baldeo Bank, which had been established in 1916 in Gwalior State, under the patronage of King Madho Rao Scindia. The bank had been the Dukan Pichadi, a small moneylender, owned by the Maharaja. In 1985, SBI acquired the Bank of Cochin in Kerala, which had 120 branches. SBI was the acquirer as its affiliate, the State Bank of Travancore, already had an extensive network in Kerala.
In March-2001, SBI partnered with BNP Paribas to form a 76:24 joint venture life insurance company named SBI Life Insurance Company.
From Wikipedia’s article on State Bank of India, shared under CC BY-SA 4.0.2