PATIALA :The merger of state Bank of Patiala (SBoP) with State Bank of India will be formalize with in next two years. A. C. Varma, Managing Director of state Bank Of Patiala disclosed here on Thursday. 

Varma said, "as of now he has no official information from State Bank of India and when it take place he don't know about it." But it will take at least two years to  fully functioning of the merger banks.

He said that it is not a question of merging SBoP only SBI will merge all 7 subsidiaries and entire Indian banking sector is looking forward to the merger SBI cannot go back on their commitment to the various parties involved in global trade. 

He said that investing in big companies would be easy after the merger process is over. It will help SBI to give advances to big companies. 

Varma said that with merging of associated banks with SBI would make SBI comfortable by March 2009 to face the biggies like the Standard Chartered or HSBC.

He however said that after ensuring parity of salary, allowances, etc of the staff of the merging Associate Banks with those of the staff of SBI, providing equal growth opportunity post-merger and solving the pension issue will smooth the way for merger.

"Fast and smooth merger of Associate Banks with SBI will prompt the other PSU banks to merge and this will trigger the process of merger in the Indian banking industry." said Varma. 

He said that the time has come for the consolidation process in the banking industry to be taken seriously so the domestic banks would be well prepared to face the stiff competition posed by foreign banks in 2009.