Bank of Baroda's market valuation fell by Rs 5,726.62 crore to Rs 30,013.38 crore on BSE. Vijaya Bank lost Rs 442.61 crore to Rs 7,355.39 crore in market capitalisation.
On the other hand, shares of Dena Bank jumped 19.75 per cent to end at Rs 19.10 -- its highest trading permissible limit for the day.
"Given the increasing size and growing market share of the Indian private sector banks, such a merger and the consequent economies and synergies will strengthen the competitiveness of PSBs as a whole," said Suman Chowdhury, President - Ratings, Acuite Ratings & Research Limited.
The government Monday said state-owned Bank of Baroda, Vijaya Bank and Dena Bank will be merged to create the country's third largest lender as part of efforts to revive credit and economic growth.
Post this merger, the number of PSU banks will come down to 19.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)