Mumbai: The country's largest lender, State Bank of India, today said it has received Reserve Bank approval for a joint venture with Societe Generale, a large financial services group from Europe, for offering custodial and related services in the country.

A release here said SBI will hold 65 per cent equity in the new company that will be set up to undertake the business, while the remaining 35 per cent will be held by Societe Generale Securities Services.

The company plans to commence operations by the first quarter of 2009 after receiving licence from market regulator SEBI, the release said.

Both companies have put in place project teams to establish operational structure of the JV. The investment in the JV by Societe Generale was approved by Foreign Investment Promotion Board in September this year, it said.

The release, however, does not specify the combined investment in the new entity.

The Reserve Bank had earlier reportedly rejected the proposal of SBI for JV with Societe Generale, which had run into some regulatory problems back home.

Indian securities services market has grown sharply over the last few years due to rise in the number of FIIs and asset management companies.

Currently, foreign banks like HSBC, Deutsche and Citi are major players offering custodial services in India.