State Bank of Saurashtra is a growing and progressive institution, with its roots firmly entrenched in the soil of Saurashtra. The region of Saurashtra, which at present forms a part of Gujarat State, comprised of many small, medium and large princely states, prior to 1948. The states of Bhavnagar, Rajkot and Porbandar, which were among the larger states and the two smaller states, viz. Palitana and Vadia, had established their own Darbar Banks. Out of these five, Bhavnagar Darbar Bank had been established in the year 1902, to which we owe our origin. These Banks were mainly catering to the needs of the respective princely states, acting as the repository for the states' treasures as also the peoples' savings. After the princely states were integrated to form Saurashtra state in 1948, a need was felt to amalgamate these banks and make them a state-owned bank was felt to serve as an instrument for developing the economy of the region. Accordingly, the Bhavnagar Darbar Bank was formed into a statutory corporation, called STATE BANK OF SAURASHTRA, under the Saurashtra State Bank ( Amalgamation ) Ordinance, 1950 and the four Darbar Banks - Rajkot State Bank, Porbandar State Bank, Palitana Darbar Bank and Vadia State Bank - were merged with it with effect from 1st July, 1950 as its branches.

The year 1960 was the most important landmark in the history of the Bank. Firstly, following the formation of a separate Gujarat State, the Bank's main area of operation - Saurashtra - became a part of Gujarat. Secondly, pursuant to the recommendations of the All India Rural Credit Survey Committee, the Bank was taken by the State Bank of India under its wings alongwith other major state - owned banks under the State Bank of India ( Subsidiary Banks ) Act, 1959. Thus, in 1960, the State Bank of Saurashtra joined the State Bank family as one of its fully owned subsidiaries so that its policies and activities could be directed to achieve the socio - economic objectives for which the State Bank of India itself was constituted. These twin events brought about a significant change in the outlook of the Bank. Apart from providing the Bank with an opportunity to expand its operations and enabling use of the network of the State Bank Group for furthering its business activities, it also enabled the Bank to grow from a state of infancy into adulthood by imbibing the rich banking traditions of the State Bank of India.

At the close of 1950, the Bank had only 9 branches and deposits of Rs.7 crores. A decade later the number of branches had increased to 24 with aggregate deposits of Rs.13.39 crores, total advances of Rs.7.93 crores and investment portfolio of Rs.8.04 crores. The paid up capital and reserves were Rs.1.51 crores. The Bank had 866 people on its payroll, to take care of its operations.