The evolution of State Bank of India can be traced back to the first decade of the 19th century. It all began with the founding of the Bank of Calcutta on 2 June 1806. The bank was redesignated as the Bank of Bengal on 2 January 1809. It was British India's first joint-stock bank, established under the patronage of the Bengal government. Subsequently, the Bank of Bombay (established on 15 April 1840) and the Bank of Madras (established on 1 July 1843) followed the Bank of Bengal. These three banks dominated the modern Indian banking landscape, until they were amalgamated on 27 January 1921 to form the Imperial Bank of India, which was the immediate precursor to the State Bank of India. Primarily Anglo-Indian creations, the three presidential banks came into being either as a result of the constraints of imperial finance or the felt needs of local European trade and were not arbitrarily imposed from outside to modernize the Indian economy. plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay. Their evolution was, however, shaped by ideas gleaned from similar developments in Europe and England, and was influenced by changes in the structure of both the local business environment and those in the relationship of the Indian economy to the economy of Europe and the global economic framework. The establishment of the Bank of Bengal marked the advent of joint-stock banking in India. So was the associated innovation in banking, viz. the decision to allow the Bank of Bengal to issue bank notes, which would be accepted for payment of government revenue within a restricted geographical area. This issue of right of note was very valuable not only to the Bank of Bengal but also to its two sisters, the Bombay and Madras Banks. This meant an increase in the capital of the banks, a capital on which the owners did not have to pay any interest. The concept of bank deposit was also an innovation because the practice of accepting money for safekeeping (and in some cases, even investment on behalf of clients) by indigenous bankers had not spread as a general habit in most parts of India. But for a long time, and especially until the time when the three presidential banks had the right to issue banknotes, banknotes and state budgets constituted the majority of the banks' investable resources. Keep in mind: this is just a sample. Get a custom paper from our expert writers now. Get a Custom Essay The three banks were governed by royal charters, which were revised from time to time. Each statute provided for a share capital, four-fifths of which was privately subscribed and the remainder owned by the provincial government. The 26 members of the board of directors, which managed the affairs of each bank, were mostly owner-managers representing large European management agencies in India. The others were appointed by the government, invariably civil servants, one of whom was elected prime minister.