Amalgamation of 10 public sector banks likely to take place on April 1

The finance ministry has agreed to a request from 10 public sector banks (PSBs) for implementing the mergers from April 1 next year.

The decision was taken in a meeting of 10 PSBs, who are part of the latest merger process, with finance ministry officials in Mumbai on Wednesday.

“The Department of Financial Services was insisting on setting January 1 as the deadline. But the banks apprised the officials about the challenges related to the merger that the banks have to deal with, especially human resources and information technology. So, April 1 has been set as the deadline for merger,” said a PSB executive.

A similar timeline for merger was followed during the amalgamation of Dena Bank and Vijaya Bank into Bank of Baroda. The move was announced September last year, swap ratio was announced in January and the merger was effective from April 1.

Finance Minister Nirmala Sitharaman last Friday had announced the merger of 10 PSBs into four entities.