The government on Friday announced the merger of Punjab National Bank, Oriental Bank of Commerce and United Bank of India to create the second-largest bank in the country, after State Bank of India (SBI). At a press conference, Finance Minister Nirmala Sitharaman announced the merger 10 public sector banks into four. After the amalgamation, only 12 PSBs will be left in India from 27.
"Punjab National Bank, Oriental Bank of Commerce and United Bank will be brought together and they shall form the second largest public sector bank with the business of Rs 17.95 Lakh crore," Finance Minister Nirmala Sitharaman said at a press conference here.
Additionally, the total business of the merged entity of Canara Bank and Syndicate Bank will be Rs 15.20 lakh crore. It will become the fourth largest PSB in the country.
Here's a list of all the public sector banks that will be merged:
1. Punjab National Bank, Oriental Bank of Commerce and United Bank
2. Canara Bank and Syndicate Bank
3. Union Bank of India, Andhra Bank and Corporation Bank
4. Indian Bank and Allahabad bank
(Source: PIB Twitter)
However, Bank of India and Central Bank is said to remain independent.
The government has earlier announced it would infuse Rs 70,000 crore in public sector banks. Of this Rs 70,000 crore, the Punjab National Bank-led merged bank will get Rs 16,000 crore, Union Bank of India-led entity Rs 11,700 crore, the Canara Bank-led entity Rs 6,500 crore and the Indian Bank-led entity Rs 2,500 crore.
Sitharaman said the creation of next-generation banks was imperative for India to become a $ 5 trillion economy in the next five years.
She said that the NPAs of banks have come down due to the measures taken by the government to strengthen the financial sector.
"The NPAs have fallen from Rs 8.65 lakh crore in December 2018 to Rs 7.90 lakh crore now," she said.
(With inputs from agencies)