The Hindu Business Line : SBI picks Finacle for global operations

FINACLE PACT: Mr A.K. Purwar, Chairman, SBI, with Mr N.R. Narayana Murthy, Chairman and Chief Mentor, Infosys Technologies, at a press conference in Mumbai on Friday. — Paul Noronha

Mumbai , Aug. 20

STATE Bank of India has awarded a $35-million contract to Infosys Technologies to power its international banking operations with Finacle, the company's universal banking solution.

The bank will deploy Finacle core-banking, e-banking and treasury solutions across current operations in 20 countries and all future additions to its global operations.

Currently, SBI has a presence in 28 countries through 54 offices. It plans to expand to 70 offices in 36 countries by the end of the current fiscal.

The bank also plans to raise $250 million by way of medium term notes (MTNs) by December this year to finance its global expansion plans, and may even raise another $250-$500 million thereafter, according to Mr A.K. Purwar, Chairman.

" Global markets are ruthless. If we are not able to compete there effectively, we can incur huge losses. Therefore, this tie-up with Infosys is of crucial importance to us," he told newspersons.

Finacle will be the single integrated universal banking solution platform for SBI globally and will replace the current disparate systems across its entire international operations, providing the bank with a unified view of its international business, better risk management capability, enhanced MIS and unified customer experience globally.

Mr N.R. Narayana Murthy, Chairman and Chief Mentor, Infosys Technologies, said: "Technology not only renders an organisation efficient but provides scalability. We will be working closely with SBI to enable them to effectively leverage technology to achieve their business objectives and global ambitions."

Speaking to newspersons on the sidelines of the conference, Mr Purwar said that SBI was looking at setting up ATMs in six or seven countries overseas, where its customers can withdraw money in local currency.

Other plans include scouting for acquisitions in Africa and Asia.

On the outlook for interest rates, Mr Purwar said that he expected the short-term interest rates to be stable, but refused to comment on the medium and long-term rates. "The current rate of inflation is not sustainable."

Commenting on the impact of yields hardening in the domestic debt market, he said that SBI had taken a hit of around Rs 2,000 crore in the last quarter on its investment portfolio of Rs 1,85,000 crore.

However, he added, SBI had a strong balance sheet and would therefore be able to withstand the spurts in inflation for some more time.

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SBI picks Finacle for global operations