Mumbai: State Bank of India chairman Arundhati Bhattacharya, who was due to retire on 6 October, has received a year’s extension, said a SBI official from the chairman’s office on the condition of anonymity .
The move comes at a time when the country’s largest bank is set to merge its associate banks and Bharatiya Mahila Bank with itself. The bank is also in the process of cleaning up Rs.98,000 crore of bad loans on its books.
Bhattacharya’s term will expire in October 2017, a finance ministry official told reporters in New Delhi, asking not to be named as the decision hasn’t yet been made public.
Appointed in October 2013 as the bank’s first female chairman and most-senior executive officer, Bhattacharya has taken steps to curtail bad debt and improve profitability at a lender that is 60.2% owned by the government. The bank reported a smaller increase in soured debt in the June quarter than investors expected.
Bhattacharya has pushed SBI to strengthen its credit-monitoring measures, to identify loans that may default and to take steps to recover them. The bank tightened eligibility criteria to focus on lending to companies less likely to default. The chairman leads a panel that works on retrieving stressed loans greater than Rs.500 crore.
Bhattacharya said in August that the merger was a “win-win” for the lender and its units, citing expected cost savings, adding that the process will be completed by 31 March. State Bank of Mysore, State Bank of Travancore, State Bank of Bikaner & Jaipur, State Bank of Hyderabad and State Bank of Patiala are the units being merged with the parent.