Differences between State Bank and Nationalized Banks
1. Though all the 27 public sector banks are corporate bodies, but the statutes under which they were established are different. The State Bank of India was ,established under the State Bank of India Act, 1955, the subsidiary banks under the State Bank of India (Subsidiary Banks) Act, 1959, and the nationalised banks under the Banking Companies (Acquisition and Transfer of Undertakings) Acts of 1970 & 1980. These banks are, therefore, governed by their respective statutes.
2. Initially. cent per cent ownership of the 20 nationalised banks vested in'the Government of In¬dia, whereas the State Bank of India was owned, to a large extent, by the Reserve Bank of India-there was small private ownership in the share capital of the State Bank. The subsidiary banks are owned by the State Bank of India. During recent years State Bank of India and some of the nationalised banks - Ori¬ental Bank of Commerce, Dena Bank, Bank of India -have enlarged their capital by issuing shares to the public.
3. The State Bank of India acts as an agent of the Reserve Bank of India. According to Section 45 of the Reserve Bank of India Act. 1934 "the Reserve Bank shall appoint the State Bank as its sole agent at all places in India where it does not have an office or branch of its Banking Department and there is a branch of the State Bank or branch of a subsidiary bank." The nationalised banks have not been conferred with this privilege of acting as agent of the Reserve Bank. Since the enforcement of the Banking Laws (Amendment) Act. 1983. the Reserve Bank has been empowered to appoint any nationalised bank to act as its agent at all places in India where it has a branch for the following purposes:
(i) paying, receiving, collecting and remitting money, bullion and securities on behalf of any government in India; and
