Government announces 55,250 crores compliances, as 10 public sector banks merge in to 4

FINANCE
Jayant Gattani | Updated: April 6, 2020, 12:39 p.m.

This slow down has had a huge impact on majority of the sectors like auto, consumer discretion, finance to name a few. State Bank of India will still be the biggest bank of India and mother of all banks as it is often referred.

category_finance/IMG_20200406_090227_hveFr4K.jpg

Since last year the indian economy has been facing a slowdown. This slow down has had a huge impact on majority of the sectors like auto, consumer discretion, finance to name a few. In order to fight the slow down the government had announced a series of measures and relief packages from the tax cut to reducing the repo rates.

The Finance Minister of India last year announced the amalgamation of 10 public sector banks into 4 banks. This step was taken by the government as a measure to boost the economy. These mergers came into effect from 1^st April 2020. Here are some of the key points which everyone should know about the merger:

1. State Bank of India will still be the biggest bank of India and mother of all banks as it is often referred.

2. Oriental Bank of Commerce and United bank will be amalgamated with Punjab National Bank and the amalgamated bank will be the 2^nd largest bank of the country. Let us look at some financial figures as per March 2019

	PNB	UBI	OBC	Post Amalgamation
Total Business (in Rs. Lakh Crores)	11.82	2.08	4.04	17.94
CASA Ratio	42.16%	51.45%	29.40%	41.33%
Net NPA	6.55%	8.67%	5.93%	6.6%
No. of Employees	65,116	13,804	21,729	100,649

3. Syndicate bank will merge into Canara bank and will become 4^th largest bank.Let us look at some financial figures as per March 2019

	Canara Bank	Syndicate Bank	Post Amalgamation
Total Business (in Rs. Lakh Crores)	10.43	4.77	15.20
CASA Ratio	29.18%	32.58%	30.80%
Net NPA	5.37%	6.17%	5.58%
No. of Employees	58,350	31,535	89,885

4. Andhra Bank and Corporation Bank will merge into Union Bank of India. Let us look at some financial figures as per March 2019

	Union Bank of India	Corporation Bank	Andhra bank	Post Amalgamation
Total Business (in Rs. Lakh Crores)	7.41	3.19	3.98	14.59
CASA Ratio	36.10%	31.59%	31.39%	33.02%
Net NPA	6.85%	5.71%	5.73%	6.20%
No. of Employees	37,262	17,776	20,346	75,384

5. Indian bank and Allahabad Bank will be merged. Let us look at some financial figures as per March 2019

	Indian Bank	Allahabad Bank	Post Amalgamation
Total Business (in Rs. Lakh Crores)	4.29	3.77	8.07
CASA Ratio	34.71%	49.49%	41.60%
Net NPA	3.75%	5.22%	4.39%
No. of Employees	19,604	23,210	42,814

6. The government will also infuse Rs. 55,250 crores for credit growth and regulatory compliances.

7. Of the sum announced PNB will get Rs. 16,000 crores, UBI Rs. 11,700 crores, Canara Bank Rs. 6,500 crores, Indian bank Rs. 2,500 crores.

8. This is the biggest ever consolidation exercise in public sector banks.

9. The exercise took place amid the ongoing Covid-19 crisis.

The top-level executives of all the anchor banks are positive about the move and are well prepared for the exercise to take place. If executed well and proper attention is given to governance then the public banking space in India can see a positive impact and also gain trust of various stakeholders.

Jayant Gattani is an established Chartered accountant and has given various views on ongoing economical and financial situation in the country.

- SUPPORT US
- To fight yellow journalism and give you the news that is mirror of truth, we need your support. We need your support to fight the lies and the propaganda. Please contribute whatever you can afford.