SBI set for restructuring its business in U.K

State Bank of India (SBI) is set for a major restructuring of its business in the U.K from April, India’s largest state-owned bank has said.

SBI’s U.K operations will transform into a subsidiary named State Bank of India UK Limited from April 1, in compliance with wider ring-fencing of capital requirements by the Bank of England.

The move will mean that all retail branches of SBI in the U.K will fall under a new U.K-incorporated banking entity instead of their previous status as overseas branches of the Indian entity.

“While there will be no visible change, the brand changes to State Bank of India UK Limited. The 12 retail branches that we have seven in London and the rest outside London will become branches of SBI UK Ltd. Apart from that, if we look at the day to day, there will be no dislocation,” said Sanjiv Chadha, SBI’s Regional Head for U.K.

He explains that while customers would be able to carry on using their debit cards and other banking facilities as before, the move marks a strategic shift for the bank with a greater focus on the U.K market.

“We will be looking to doing more business in the U.K, expanding the products that are designed for the U.K market,” he said.

The move follows Bank of England’s Prudential Regulation Authority (PRA) directing foreign banks a few years ago to move from their retail status as overseas branches to independent entities in order to protect depositors in the UK from fluctuations in foreign markets.

“As a subsidiary, the capital will be ring-fenced and that brings an additional comfort level,” said Chadha.

He highlighted that the restructuring marked a major endorsement for London as a financial capital of the world, despite uncertainties triggered by the 2016 referendum in favour of an exit from the European Union (EU).


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