The merged entity will be 7th largest PSU bank in India
In a press briefing today, finance minister announced that Indian Bank and Allahabad Bank will be merged. The entity will be seventh largest public sector bank with business of Rs 8.08 lakh crore.
The entity will have nationwide presence with strong networks in the South, North and East.
The scale and synergy will benefit through doubling of business size. Major scaling up of reach due to complementary networks. High CASA and lending capacity in consolidated bank.
Both the banks share a common CBS (core banking software), BaNCS, which will enable quick realisation of gains.
Shares of Indian Bank rose 4.63% to Rs 200.2. The stock hit a 52-week high of Rs 339 on 03 Sep 2018. The stock hit a 52-week low of Rs 160.2 on 05 Aug 2019. Indian Bank has underperformed the market in past one year, sliding 41.55% as against Sensex's 4.27% fall.
Shares of Allahabad Bank rose 4.44% to Rs 35.3. The stock hit a 52-week high of Rs 58.8 on 11 Mar 2019. The stock hit a 52-week low of Rs 30 on 23 Aug 2019. Allahabad Bank has underperformed the market in past one year, declining 16.23% as against Sensex's 4.27% fall.
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