Continuing with its thrust to achieve Prime Minister Narendra Modi's dream of a $5 trillion economy, Finance Minister Nirmala Sitharaman announced the merger of the country's top Public Sector Banks (PSBs).
In place of fragmented lending capacity with 27 PSBs in 2017, now there will be 12 PSBs post-consolidation.
Here's a list of the banks that are going to be merged and what this merger means:
1. Consolidation of Punjab National Bank, Oriental Bank of Commerce and United Bank
The merged entity would be the 2nd largest PSB with Rs 18 lakh crore business and 2nd largest network with 11, 437 branches across India. The merger would lead to a high Current And Savings Account (CASA) ratio and high lending capacity. Same Core Banking System (CBS), Finacle, in all three banks would enable quick resolution of gains.
2. Consolidation of Canara & Syndicate Bank
The merged entity will be the fourth largest PSB with Rs 15.2 lakh crore business and third-largest network with 10,342 branches. Synergies, culture & common CBS platform to enable the quick realization of operational gains & enhanced lending capacity.
3. Consolidation of Union, Andhra & Corporation Banks
The merged entity would be the fifth-largest PSB with Rs 14.6 lakh crore business and fourth-largest network with 9,609 branches in India. Strong scale benefits to all 3 with business becoming 2 to 4.5 times that of the individual bank.
4. Consolidation of Indian & Allahabad Bank
The merged entity to be the 7th seventh-largest PSB with Rs 8.08 lakh crore business. Strong scale benefits to both with business doubling. High CASA & lending capacity combined in the consolidated bank.
News Source: Economic Times, Url: https://bit.ly/2m7fiYB