The question asks to identify the first Public Sector Bank (PSB) that became a repository participant in Central Depository Services (India) Limited, commonly known as CSDL.

Understanding CSDL and Repository Participants

CSDL is one of the two central securities depositories in India (the other being NSDL). A securities depository holds securities (like shares, bonds, mutual fund units) in electronic form, just like a bank holds funds in accounts.

A repository participant, also known as a Depository Participant (DP), is an agent of the depository (like CSDL or NSDL). They are the intermediaries through whom investors can open demat accounts and hold their securities in electronic form. Banks, financial institutions, and stockbrokers can become DPs.

Identifying the First PSB in CSDL

Among the Public Sector Banks listed, Bank of Baroda holds the distinction of being the first PSB to become a repository participant with CSDL.

This means that Bank of Baroda was the first bank owned by the government in India to offer demat account services to its customers through CSDL's infrastructure.

Analyzing the Options

• State Bank of India: While a prominent PSB and DP, it was not the first PSB to join CSDL as a repository participant.
• Bank of India: Also a PSB and DP, but not the first one to associate with CSDL in this capacity among PSBs.
• Bank of Baroda: This bank was indeed the first Public Sector Bank to become a repository participant in CSDL, allowing it to provide demat services.
• Allahabad Bank: While a PSB (now merged), it was not the first one to become a CSDL repository participant.

Therefore, based on historical information regarding the development of depository services in India, Bank of Baroda was the first Public Sector Bank to become a repository participant of CSDL.