FM announces merger of 10 Public Sector Banks into four
In a major move, Finance Minister Nirmala Sitharaman on Friday announced the consolidation of 10 Public Sector Banks (PSB) into 4 financial institutions.
1. Indian Bank will be merged with Allahabad Bank; 2. Punjab National Bank (PNB), Oriental Bank of Commerce (OBC) and United Bank of India merged; 3. Union Bank of India (UBI), Andhra Bank and Corporate Bank to be merged; 4. Canara Bank and Syndicate Bank to be merged.
She said that the merger of Indian Bank and Allahabad Bank will be the 7th largest PSBs with a business of 8.08 lakh crore while the consolidated UBI, Andhra Bank and Corporation Bank will be the 5th largest PSB with Rs14.6 lakh crore business and consolidated Canara Bank and Syndicate Bank will be the 4th largest PSB with Rs 15.2 lakh crore business.
She also announced that in place of fragmented lending capacity with 27 PSBs in 2017, now there will be only 12 PSBs post the latest round of consolidation of PSU banks.
It may be noted that earlier the government had approved the merger of Vijaya Bank and Dena Bank with Bank of Baroda that came into effect from April 1, 2019.
Meanwhile, the FM also said that the Bank of India and Central Bank of India will continue as central banks with a national presence while the Indian Overseas Bank will continue its operations in South. Similarly, the UCO Bank will continue to operate in the east and Punjab and Sind Bank will continue with its business in the north.