Signs of change at SBI, associate banks ahead of merger
SBI is undergoing a rebranding exercise, under which its getting a redesigned logo, and launching an ad campaign from 1 April ahead of its merger with associate banks
Mumbai: S.A. Radhakrishnan, 59, manager at the Chembur, Mumbai, branch of State Bank of Travancore (SBT) will have a new identity from Saturday. He will be an employee of State Bank of India (SBI), the country’s largest lender, which is merging its five associate banks with itself.
“Talks of merger have been going on since 1984, two years after I joined SBT. In that sense we have been preparing for D-day for many months now. Yet it feels like getting your daughter married off,” he said.
The signs of change are already visible, although the merger is expected to be completed only by the second quarter of the next fiscal. The signboard outside the Chembur branch does not read SBT anymore. It sports the new SBI signage, with its iconic keyhole set against a navy blue backdrop, a look perfected by Design Stack, an agency hired for a rebranding exercise undertaken by the 200-year-old bank ahead of the merger.
The idea behind the fresh look is to portray SBI as a bigger bank with a focus on young customers, yet retaining the old ones, said one of its officials, who did not wish to be quoted as he isn’t authorized to speak to the media. The bank is also going to launch a nationwide print and television ad campaign on 1 April. RK Swamy and DDB Mudra have been hired to help with these campaigns.
The last time such a rebranding exercise was undertaken was in 1971, soon after the government nationalized banks. SBI chose the keyhole to symbolize its role of a custodian that will keep customers’ money safe. Although the bank has retained the logo, it has tweaked the colour scheme to give it a fresh look.
“Considering that we were changing the signage of 7,000 branches of associate banks, we thought why not change the look altogether,” said Dinesh Khara, SBI managing director in charge of associate and subsidiaries.
However, this is easier said than done. Thousands of new stationery items have to be replaced, chequebooks freshly printed and signages of 16,000 branches of SBI alone changed before the merger is done.
SBI’s merger with its associate banks will catapult it to the top 50 banks in the world, with a balance sheet of Rs41 trillion, 277,000 employees, 24,000 branches and 500 million customers.
Both employees and customers of the smaller subsidiary banks have concerns. The merger is supposed to help SBI rationalize costs and benefit from having a larger treasury book, while lower cost of deposits will boost margins.
However, this would necessarily involve shutting down branches and relocating employees. SBI is looking to close nearly half the associate banks’ branches and three of their head offices, the Indo Asian News Service reported on 21 March citing Khara.
Customers such as N.R. Raja Pandian, who has banked with State Bank of Patiala’s Chembur branch for the past 15 years, are concerned about a potential fall in customer service.
“SBP gives me personalized service which I would never have received in a big bank. And it is this continued service that I seek when SBP becomes SBI,” said Pandian.
Apart from that, customers potentially face lower interest rates and higher service charges, according to information in these banks’ websites.
To dispel such worries, Khara and his team have been engaging in several customer meetings since September to make people understand the process and also assure them of better service post the merger. Recorded video messages of chairman Arundhati Bhattacharya and other senior officials were sent to each employee to assuage their concerns, said officials.
Still, there will be some rationalization in the work force. Earlier this month, SBI launched a Voluntary Retirement Scheme (VRS) for nearly 12,000 employees of associate banks. According to Khara, around 6,000 employees are expected to accept the offer, which will close on 5 April.