MUMBAI, Nov 4: The State Bank of India (SBI) is planning to divest its stake below 75 per cent in State Bank of Hyderabad (SBH), a wholly owned SBI subsidiary, to ensure firm allotment for all employees of the bank. SBH's proposed Rs 69 crore public issue was stalled as trade unions demanded firm allotment for all employees. ``The stalemate has been solved and we are ensuring that every employee gets firm allotment,'' a SBI source said. SBI, India's largest commercial bank, which had earlier planned to divest only 75 per cent has now decided to go for further divestment. ``We are actively looking at this option,'' the source said. SBH, which had earlier decided against making any reservation for the parent bank, might now make a firm allotment to SBI as well to its other two subsidiaries -- State Bank of Travancore and State Bank of Bikaner & Jaipur.

The issue was stuck as 15,100 employees of the bank wanted firm allotment. However, SBH was offering 5,75,000 equity shares to the public out of which 10 per cent was being reserved for employees as per the Securities and Exchange Board of India (Sebi) guidelines. The bank, in other words, could reserve only 57,500 equity shares for its employees. With the marketable lot at five equity shares, about 11,400 employees would have got a firm allotment while the rest 4,000 would have to pick up shares from the market.

According to SBI sources, the bank might tap the equity market in January if it can get its half-yearly accounts audited.

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