You are here: Home » International » News » Economy
Business Standard

Public sector banks merger: Modi govt to announce big bang plan soon

Finance ministry has called a meeting with chief executives of ten public sector banks, on Friday

Banks merger


The National Democratic Alliance (NDA) government has readied its mega plan for merging multiple set of (PSB) and is set to make an announcement anytime soon, according to multiple sources.

Testing Table
India 15%
Africa 10%
Australia 12%

The department of financial services in the ministry has called a meeting with chief executives of ten public sector banks, which are seen as top contenders for merger, on Friday.testing.. we are here....

The invited for consultations on Friday are: Union Bank of India, Canara Bank, Punjab National Bank, United Bank, Oriental Bank of Commerce, United Bank, Allahabad Bank, Corporation Bank, Syndicate Bank and Andhra Bank.

“The merger will be announced anytime soon as part of the government's reforms agenda,” said a top source familiar with the development.

Punjab National Bank, and might be which will be subsuming other

“It looks like PNB will be merged with three more banks, including Andhra Bank and Oriental Bank of Commerce,” another source said.

In her press briefings recently, Minister Nirmala Sitharaman has been dropping hints of two more set of reform measures that the government is set to announce.

For the first time, under the Narendra Modi government’s tenure, two set of mergers took place — One, five associate banks and Bharatiya Mahila Bank merged with State Bank of India (April 2017), and two, Dena Bank, merged with which came into effect from April 1 this year.

The central government has to consult the RBI before formulating a plan for merger, according to the Banking Companies (Acquisition and Transfer of Undertakings) Acts of 1970 and 1980.

Sources said the central government has already consulted the RBI regarding its merger plans earlier this year.

The plan for PSB merger has to be approved by a group of ministers, known as the alternative mechanism. Sitharaman and commerce and industry minister Piyush Goyal are a part of it.

“India needs fewer, mega banks which are strong, because in every sense, from borrowing rates to optimum utilisation, the economies of scale as far as banking sector are concerned are of great help,” former minister Arun Jaitley had said earlier this year.

The Central government has found merit in merging PSBs, especially after the two mergers have shown fruitful results. In the first quarter of this financial year, Bank of Baroda’s net profit shot up 34% to Rs 710 crore. This was the first results announced by the bank following its merger with and

Twitter: @someshjha7 @aruproytweets

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Fri, August 30 2019. 13:21 IST