The merger of State Bank of India, the largest lender of the country with its associate bank, State Bank of Indore has finally been approved by banking regulator, RBI.

The apex bank is understood to have given its nod to the amalgamation proposal.

SBI had earlier said that it wanted to go ahead with the merger in the 1st quarter of this fiscal. It has however not officially confirmed the approval.

The bank had got approval from its board as well as the Center for the merger. RBI's approval was pending.

SBI holds 98% stake in State Bank of Indore.

The share exchange ratio of the bank has been declared as 34:100.