BSc monthly magazine Sept An inter-ministerial panel headed by finance
minister Arun Jaitley on 17 Sep
asked state-run Bank of Baroda (BoB), Vijaya Bank and Dena Bank to consider amalgamation
to create the country's third-largest lender. The decision comes as a relief for Dena Bank, BSc monthly magazine Sept which is
one of the 11 stressed public-sector banks
(PSBs) on the central bank's watch list and which also faces restrictions on lending until it fixes its poor finances. The govt expects the two relatively strong banks - BoB and Vijaya Bank-will easily absorb potential shock of
amalgamating with a weak one. BScmonthly magazine Sept The latest
move is part of the govt's reform initiatives to create a few but
strong banks with much larger balance sheets to support the rising
appetite for credit of the fast-growing economy and enable optimum utilisation
of resources. BSc monthlymagazine Sept The
merged entity has a combined business of Z14.8 lakh cr, deposits
of 28.4 lakh cr, gross advances of Z6.4 lakh cr, and 85,675
employees, based on the position as on Jun 30. The boards of
these three banks are expected to meet soon to consider the proposal and
work out modalities. BoB managing director (MD) PS Jayakumar said the amalgamation process may take four
to six months
to complete. BSc monthlymagazine Sept The
govt currently owns majority stakes in 21
lenders, which account for over
two-thirds of the country's banking assets. But they also account for an overwhelmingly large share in total nonperforming
assets (NPAs) in banking.
