The government’s plan to merge associate banks with the State Bank of India (SBI) has not gone down well with the banking employees’ associations.

Protesting against such a move the All India Bank Employees’ Association (AIBEA), the largest bank employees’ union and Bank Employees Federation of India (BEFI) have called for observing anti-merger day on September 5 that will culminate into day-long bank strike on September 25.

“We strongly protests against any such proposals of closing down the associate banks and taking over by the SBI,” said the press note of AIBEA. On September 5, the associate bank employees are planning to launch dharna at their respective head offices in Bangalore, Trivandrum, Hyderabad, Jaipur and Patiala.

According to the AIBEA, the associate banks that includes State Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and State Bank of Travancore, have performed better than the SBI. “The total business of the five associate banks is more than Rs. 7,50,000 crore. For the year 2012-13, these banks earned operating profit of Rs. 8,800 crore with net profit of 3,700 crore,” said the AIBEA note.

The employees association also demanded that the associate banks be delinked from the SBI. “The associate banks should be allowed to function as autonomous banks like other banks; they would be able to do far better. There is enough scope and potential for these banks to grow and progress,” said D.D. Rustagi, joint secretary of AIBEA.

The AIBEA said that the SBI investment is only Rs. 430 crore in the associate banks which have net owned fund of Rs. 26,436 crore. “There is no demand from employees, depositors, borrowers, general public and even share holders. Then why this merger?” said Rustagi. Two of the associate banks were merged with the SBI in 2008 and 2010 respectively. The State Bank of Saurashtra was merged in 2008 followed by State Bank of Indore in August 2010 with the SBI.

By the end of this month, the government is likely to announce the merger of one of the associate banks with the SBI. “If SBI can function with 15,000 branches, there is no reason why the associate banks cannot survive on their own,” said a letter by the AIBEA which was addressed to finance minister P. Chidambaram. 

The associations have also demanded that corporate and business houses should not be provided with banking licenses.