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Finance Ministry proposed to merge 3 PSBs Bank of Baroda, Dena Bank & Vijaya Bank
Finance Ministry proposed to merge Bank of Baroda, Dena Bank & Vijaya Bank: Details, Aim, Importance, Highlights
Union Finance Ministry on 18th September 2018 has proposed to merge 3 public sector banks (PSBs) viz Bank of Baroda, Dena Bank and Vijaya Bank.
The merging of these three lending entities will create India’s third-largest bank with a total business of more than Rs 14.82 lakh crores.
The announcement was made during a press conference by Rajeev Kumar, Secretary of Department of Financial Services, Union Ministry of Finance.
The proposal will now need the approval of the boards of these individual banks. The banks' boards will shortly meet and take up the decision, said the Finance Minister Arun Jaitley after Kumar's statements.
The merger of these three state-owned banks is a part of the government's agenda of consolidation of public sector banks. The consolidation was proposed by the Alternative Mechanism comprising Chairperson Arun Jaitley.
Importance
The consolidation will help create a strong globally competitive bank with economies of scale.
This will ensure the realization of synergies for networks, low-cost deposits and subsidiaries of the three banks.
The merged entities will have better financial strength.
The merger will result in a substantial rise in customer base, market reach, operational efficiency, and a wider bouquet of products and services.
It will place all the three banks on Finacle Core Banking Solution (CBS), a platform that helps banks enhance agility and efficiency of operations, while significantly improving customer experience across channels.
There will be no adverse impact on employees and customers of the individual banks as a result of the proposed merger
