India merges 10 public banks into 4 |
Indian Banking sector will now have less but strong state run banks as the Modi government on Friday announced merger of 10 public sector banks into 4 banks. United Bank of India and Oriental Bank of Commerce will be merged with Punjab National Bank, making the proposed entity the second largest public sector bank. Making the announcements, Finance Minister Nirmala Sitharaman said Syndicate Bank will be merged with Canara Bank, while Allahabad Bank will be amalgamated with Indian Bank. Similarly, Andhra Bank and Corporation Bank will be consolidated with Union Bank of India. She said, in place of fragmented lending capacity with 27 PSBs in 2017, now there will be only 12 state-run banks post consolidation. The finance minister also said banks will be provided adequate capital. Last week, she had announced that the Rs 70,000 crore capital infusion for PSBs for the current fiscal would be front-loaded. Post the consolidation, Punjab National Bank will have business size of Rs 17.94 lakh crore, becoming the second largest PSB after SBI with a business of Rs 52.05 lakh crore. The consolidated Canara Bank will be the fourth largest bank with business of Rs 15.2 lakh crore, followed by Union Bank of India at Rs 14.59 lakh crore.
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