PSU bank stocks end on mixed note as mega merger of lenders takes effect

Shares of public sector banks closed the day on a mixed note after the mega merger of PSU lenders came into effect from Wednesday.

As per the mega consolidation plan, Oriental Bank of Commerce and United Bank of India merged into Punjab National Bank (PNB); Syndicate Bank into Canara Bank; Andhra Bank and Corporation Bank into Union Bank of India; and Allahabad Bank into Indian Bank.

Shares of Punjab National Bank dropped 5.72 per cent, while Canara Bank fell marginally by 0.17 per cent on the BSE.

In contrast, Indian Bank gained 1.86 per cent and Union Bank of India rose marginally by 0.17 per cent.

The broader market depicted a weak trend, with the 30-share BSE barometer tanking 1,203.18 points or 4.08 per cent to close at 28,265.31.

The consolidation exercise assumes significance as it took place at a time when the entire country is under the grip of the COVID-19 outbreak, which has triggered a 21-day lockdown.

State-owned Punjab National bank on Wednesday said all nation-wide branches of United Bank of India and Oriental Bank of Commerce has started functioning as PNB branches.

The amalgamation of Punjab National Bank, United Bank of India and Oriental Bank of Commerce has come into effect from April 1, 2020.

Last year, Dena Bank and Vijaya Bank were merged with Bank of Baroda.