SBI To Hive Off Its Non-Banking Businesses

State Bank of India (SBI) has decided to hive off its insurance and asset management and other non-banking business into a separate entity. This will perhaps ease the pressure on the bank''s balance sheet.SBI has told analysts that it might spin off its non-banking businesses life insurance, asset management and all other non-banking companies by transferring them to a separate Non Banking Finance Company (NBFC).The proposed NBFC, to be fully owned by SBI could consider listing is valued at $3.8 billion with each share being valued at Rs 229 by Merrill Lynch based on FY''09.Analysts say the requirement of capital in insurance business is much greater, once it was hived off into separate entity the insurance business would not stretch SBI''s balance sheet.In fact that''s something that ICICI Bank has done recently. The management also hinted that the bank might also list the non-banking businesses.