Which bank has became the first Indian Bank to have an office in Australia's Victoria State ?

Question

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Correct — option (2), the State Bank of India. SBI opened an office at 420 Collins Street in Melbourne on 30 September 2019, and the Government of Victoria announced it in those terms, welcoming the State Bank of India as the first Indian bank to set up operations in Victoria. Read the stem precisely, because the whole question lies in two words. It does not ask which Indian bank first opened in Australia — Indian banks had been present in the country for decades — it asks about Victoria, one of the six States of the Australian federation, whose capital is Melbourne. An Indian bank in Sydney is in New South Wales and does not answer this question. The distinction matters because two of the three wrong options here have had representative offices in Sydney at one time or another, so a candidate who reads 'Australia' and stops reading has three defensible answers in front of him and no way to choose. SBI is the natural bank to have taken the step. It is the largest commercial bank in India and the one with the widest foreign network, and its own history is worth carrying: it descends from the Bank of Calcutta established on 2 June 1806, which with the Bank of Bombay and the Bank of Madras formed the three Presidency banks; those three were amalgamated into the Imperial Bank of India in 1921; and under the State Bank of India Act, 1955 the Reserve Bank of India acquired a controlling interest, so that on 1 July 1955 the Imperial Bank of India became the State Bank of India. In 2008 the Government of India bought out the Reserve Bank's shareholding, removing the anomaly of the banking regulator owning the largest bank it regulated. Note finally the printing of the stem: the English column reads 'Which bank has became', which is not grammatical, and the same sentence in the Marathi column is unremarkable. It is a misprint and nothing more; it carries no information about the answer, and the question is answered exactly as though it read 'has become'. The answer to be marked is option (2).

Why the other options are wrong — (a) Dena Bank could not have opened an office in Victoria in the second half of 2019 because by then it no longer existed as a bank. Founded on 26 May 1938 by the sons of Devkaran Nanjee as the Devkaran Nanjee Banking Company and renamed Dena Bank when it became a public company in 1939, it was nationalised in 1969 and remained a mid-sized public sector bank headquartered in Mumbai with about 1,874 branches. In September 2018 the Government proposed amalgamating Dena Bank and Vijaya Bank into Bank of Baroda; the boards and the Union Cabinet approved on 2 January 2019 and the amalgamation took effect on 1 April 2019, making Bank of Baroda the third largest bank in the country. SBI's Melbourne office opened on 30 September 2019, six months after Dena Bank had ceased to be a separate entity. The lesson generalises: the wave of public sector bank amalgamations between 2017 and 2020 removed a number of familiar names, and a bank that no longer exists cannot be the answer to a question about a recent first.  (c) Bank of Baroda is a plausible answer for the wrong reason, and it is worth understanding exactly why it fails. BoB was founded on 20 July 1908 by Maharaja Sayajirao Gaekwad III of Baroda, was nationalised in 1969, and became the Indian bank most identified with overseas expansion, opening branches in Kenya, Uganda and Tanzania from 1953 onwards and reaching Bahrain, Mauritius, Hong Kong and the United Kingdom in later decades. It did have an Australian presence: a representative office opened in Sydney in 1980, which the bank closed in 1992. Sydney, however, is in New South Wales, not Victoria, and a representative office that was shut in 1992 is in any case no answer to a question about a first office in Victoria in 2019. This is exactly the trap the question is built on — a candidate who converts 'Victoria State' into 'Australia' will find Bank of Baroda a strong answer and will be wrong on geography rather than on banking.  (d) Punjab National Bank is likewise present in Australia, and likewise in the wrong State. Founded in May 1894 at Lahore and registered under the Indian Companies Act on 19 May 1894 with its office in Anarkali Bazaar, PNB was conceived as a genuinely national bank; it lost its Lahore premises at Partition, moved its registered office to Delhi, and was nationalised in 1969. Its overseas structure today mixes branches, subsidiaries and representative offices — a subsidiary in the United Kingdom, branches in Hong Kong, Kowloon, Dubai and Kabul, and representative offices in Almaty, Dubai, Shanghai, Oslo and Sydney. The Sydney presence is a representative office, in New South Wales, and it is worth knowing the difference between the forms: a representative office may market the bank and liaise with customers but cannot take deposits or lend, whereas a branch does full banking business under the host country's licence. Neither form was in Victoria before SBI opened at Melbourne in September 2019.

Concept: Indian banks go abroad in three forms, and the difference between them explains a good deal of news of this kind. A representative office is the lightest form: it may promote the bank's business, gather information and serve as a point of contact for the diaspora and for trade, but it may not accept deposits or make loans. A branch is the full form, licensed by the host regulator to do banking business. A subsidiary is a separately incorporated bank in the host country, wholly or partly owned by the Indian parent, which is what Punjab National Bank operates in the United Kingdom. The pattern of Indian overseas banking followed the pattern of Indian migration: Bank of Baroda opened in Mombasa and Kampala in the 1950s to serve East African Indian communities, and Indian banks later concentrated on the Gulf, Britain, Hong Kong and Singapore for the same reason. Australia entered the picture late and lightly — representative offices in Sydney, the largest city and the financial centre of New South Wales — and the State of Victoria, whose capital is Melbourne, had no Indian bank at all until the State Bank of India opened at 420 Collins Street on 30 September 2019. The Australian federation has six States and two mainland territories, and questions of this kind depend on knowing that a fact about Sydney is not a fact about Victoria.

State PCS 2022 Q84 — Current Affairs PYQ with Answer

State PCS 2022 Q84 — Current Affairs PYQ with Answer