Question

which of the following is not the benefit arisen out of this sbi merger deal?

1)pan India presence
2)more credit outflow into productive investments
3) reduction in capital adequacy ratio
4)increase in market share​

Answer 1

Answer:

4. no. ................,...

Answer 2

Answer:

Which of the following is not the benefit arising out of this State bank of India merger deal?

1)pan India presence

2)more credit outflow into productive investments

3) reduction in capital adequacy ratio

4)increase in market share​

The Correct Option is 2)more credit outflow into productive investments.

Explanation:

• Option 1 - Pan India presence

The merger of SBI with other banks lead to an increase in its presence in the remote past area of the country. Since most of the banks were Gramin or local state banks so post-merger SBI had 22000 branches across India.

• Option 2 - More credit outflow into productive investments

This was not the benefit since most of the investments or the loans given by the bank were to farmers or small enterprises that were not able to repay them back. Hence credit outflow was not efficient and not at all a benefit to the bank.

• Option 3 - Reduction in capital adequacy ratio

The capital adequacy ratio of the bank post-merger was reduced since the accounts of the bank merged together giving greater capital reachability.

• Option 4 - Increase in market share

The mergers of the bank with SBI bank lead to an increase in market share and balance sheet totalling up to 333 billion dollars.

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