Govt announces mega merger of public sector of banks

Number of public sector banks declines to 12 banks after merger

The finance minister has announced the mega merger of public sector bank (PSBs) reducing the number of PSBs to 12 banks furthering the processing of consolidation in the public sector banks compared with 27 PSBs in 2017.

The finance minister has announced 4 sets of merger including the merger of Punjab National Bank, Oriental Bank of Commerce and United Bank of India to emerge as second largest PSB with Rs 18 lakh crore business and second largest branch network in India. The salient feature of merger includes Scale, nationwide & global presence and high CASA to drive growth.

In the second set, Canara Bank and Syndicate Bank would be merged to emerge as fourth largest PSB with Rs 15.2 lakh core business and 3rd largest branch network in India. Synergies, culture & common CBS platform to enable quick realisation of operational gains & enhanced lending capacity are important feature of this merger.

Union Bank of India would be merged with Andhra Bank and Corporation Bank to emerge as 5th largest PSB with Rs 14.6 lakh crore business and 4th largest branch network in India. Important feature includes strong scale benefits to all 3 with biz becoming 2 to 4-and times that of individual bank.

Further, Indian Bank and Allahabad Bank would be merged to emerge as 7th largest PSB with Rs 8.08 lakh crore business. Important feature of this merger includes strong scale benefits to both with business doubling, high CASA & lending capacity combined in consolidated bank.

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