NEW DELHI: Ten public sector banks (PSB) on Wednesday merged to become four large banks, bringing down the number of PSBs to just 12. The mergers announced last September and cleared by the cabinet last month were effected despite banks running low-key operations amidst the pandemic.
Under the scheme, Oriental Bank of Commerce (OBC) and United Bank of India have been merged into Punjab National Bank. Post-merger, the entity will form the second-largest PSB in the country. Syndicate Bank has been merged into Canara Bank, making it the fourth-largest public sector lender. Union Bank’s merger with the Andhra and Corporation banks will make it the fifth largest PSB lender, while Allahabad Bank will now act as a branch of Indian Bank. “It’s a good move since it will reduce the number of branches, improve cost efficiency and, most importantly, the balance sheets post mergers are likely to be strengthened,” Sai Sanjay Bhattacharyya, former Managing Director of SBI.
Officials in the Finance Ministry officials said these banks have already started sending out messages to customers informing them of the mergers.