New Delhi: Finance minister Nirmala Sitharaman on Wednesday said that there is no uncertainty on the proposed merger of public sector banks (PSBs), which is underway and will meet the implementation date of 1 April.
“We are going as per schedule on that. There is no uncertainty," she said, adding that there is no need for any speculation pertaining to the same.
Last year, the finance ministry announced the consolidation of 10 public sector lenders into four bigger and stronger banks. Punjab National Bank (PNB), Oriental Bank of Commerce (OBC) and United Bank will be brought together to form the second largest public sector bank in the country, after State Bank of India (SBI).
The other merger will be between Canara Bank and Syndicate Bank, which will make it the fourth-largest public sector lender, while Union Bank of India will be merged with Andhra Bank and Corporation Bank to build India’s fifth-largest lender. In addition, Indian Bank will be merged with Allahabad Bank to make India’s seventh-largest PSB.
In April 2019, Bank of Baroda became country’s third largest lender after its merger with Dena and Vijaya Bank. In 2017, five associate banks and Bharatiya Mahila Bank merged with SBI.
Currently, there are 18 PSBs as compared to 27 in 2017. There will be only 12 public sector lenders post the merger.
However, the Cabinet is yet to approve the proposed mega merger plan, after which share swap ratio will be announced and the shareholders consent will have to taken, a senior public sector bank official said.
The finance minister's response comes in the background of a recent news report that the finance ministry was treading cautiously even as the deadline to merge the balance sheets of the banks is a month away. Besides, the Prime Minister’s Office had sought details of the benefits for merger of state-owned banks earlier during the month.