IOB received an approval from the Reserve Bank of India to acquire SSSB in December 2008. The RBI, in the wake of financial irregularities leading to losses of over Rs 350 crore, placed SSSB under moratorium in September 2006.

After formation of scheme with the administrations the acquisition process will be completed and SSSB will come under the banner of IOB from April 6, 2009, a senior official from SSSB said.

The MOU was signed by administrator of SSSB Sanjay Kumar Bhosale and Anbu C, AGM, IOB, Pune on Tuesday.

At present, SSSB has a deposit base of around Rs. 639 crore and a liquid cash asset amounting to Rs 348 crore.

Loans given to borrowers amount to Rs 350 crore. As on December 31, 2008, the bank reported a net loss of Rs. 207 crore as against a net loss of Rs. 357 crore in 2006, he said.

The administrator had recovered Rs. 430 crore worth outstanding loans from September 2006.

Today, the outstanding loans stand at Rs 350 crore of which Rs 150 crore is owed by the Agashe family.

SSSB will now submit a scheme for the transfer of assets and liabilities of the bank to RBI.

SSSB has around 12 branches including 9 in Pune, one in Solapur and 2 in Mumbai.