Bank stocks rise on merger talk

The stocks of domestic banks on Friday saw a spike of between 0.72 per cent and 13 per cent on reports that top state-run banks were warming up to the consolidation idea.

The chiefs of top five banks — Punjab National Bank (PNB), Canara Bank, Union Bank of India, Bank of India and Bank of Baroda — had met finance ministry official on Wednesday to discuss the issue. The meeting was chaired by GC Chaturvedi, additional secretary in the finance ministry.

Dena Bank was the top gainer. The stock rose 12.97 per cent to Rs 81.45 on the Bombay Stock Exchange (BSE) after reports suggested that both Canara Bank and PNB had shown interest in acquiring it.

Other gainers included Allahabad Bank, up 5.24 per cent to Rs 139.50; Oriental Bank of Commerce, up 4.90 per cent at Rs 289; Indian Overseas Bank, up 4.51 per cent at Rs 155.95; Canara Bank, up 4.15 per cent at Rs 371; Union Bank, up 3.97 per cent at Rs 272.25; Yes Bank, up 3.94 per cent at Rs 259.75; IDBI Bank, up 3.11 per cent at Rs 127.75; Bank of India, up 2.82 per cent at Rs 388.95; State Bank of India, up 2.42 per cent at Rs 2,335.75; HDFC Bank, up 2.09 per cent at Rs 1,755.50; PNB, up 1.97 per cent at Rs 917.30; and Bank of Baroda, up 1.70 per cent at Rs 539.75.

Bank strike on Dec 16
Newswire 18 adds: Nearly 400,000 employees of public sector banks would strike work on December 16 to protest the government thrust on consolidation among state-owned banks, CH Venkatachalam, general secretary, All India Bank Employees’ Association, said on Friday.

“Merger of state-run banks will make them bigger but not stronger. We need expansion of banking operations and not consolidation. Nearly 500 million people in this country still do not have bank accounts,” Venkatachalam said.