The government is working on the agenda of the merger of banks with the goal of preparing 3-4 banks of global size. It has reduced the number of government-owned banks from 21 to about 12. A government official said that the merger of banks will be brought to the number 10-12 in the next few years.
The three-level structure, the country’s largest bank will have at least 3-4 bank size of SBI. According to them, certain area special banks such as Punjab and Sind Bank and Andhra Bank will remain with their independent identities, besides some medium-sized banks will also be in existence.
Last month, Finance Minister Arun Jaitley had said that the government is actively working towards the merger of public sector banks but they refused to give details. He had said that it is sensitive to price related information. Excited by the successful merger of SBI, the Finance Ministry is looking at approving such other proposals in banking sector in the public sector till the end of this financial year. It is hoped that the situation of stranded debt will be controlled till then.
There will be some big banks in this system, some small and local banks will be there. There will be a need for diversity in this system.
On the condition of not disclosing the name, another official said that one possible option could be that Punjab National Bank, Bank of Baroda, Canara Bank and Bank of India can start looking for banks who are ready for acquisition Are there. In case of adjustment of banks, its loans, human resources, geographical location etc. will be kept in mind.
Significantly, a few months ago, the government merged its five associate banks and Indian women banks in SBI. Since then, State Bank has managed to make the country’s largest and the top 50 banks in the world.
Source: Economics Times