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Finance Minister Nirmala Sitharaman, on Thursday, urged the banks going in for consolidation to ensure that customers are not inconvenienced by the structural changes.
Banks have been advised to ensure that credit flow in the system is not adversely impacted by the mega consolidation, said a chief executive with a public sector bank (PSB) after a review meeting by Sitharaman to assess the progress being made on the consolidation front.
Under the proposed amalgamation, as many as 10 PSBs will be consolidated into four mega banks.
The chief executive of the concerned anchor bank PNB (in the case of consolidation with Oriental Bank and United Bank) made a presentation and was joined by other two chief executives. The Finance Minister met the groups separately as part of the review, according to sources.
Detailing the progress made, banks are understood to have conveyed that they are on course to effect the implementation from April 1 as planned.
Common signage
In the case of PNB-OBC-United Bank, it was highlighted that the two banks (OBC and United Bank) will change their signages into that of PNB at their branches from April 1.
The effort will be to present all the 11,000 branches of the combined entity under a common signage. Customers of the three banks can avail as many as 14 services on April 1 itself from any of the 11,000 branches. Of the 14 services, seven will be financial services and the rest non-financial ones, the sources added.
The entire effort will be to provide a smooth transition for the customers of OBC and United Bank post amalgamation with PNB. Although both OBC and United Bank wanted the combined amalgamated entity to don a new name, they have now settled to the Centre’s direction that the combined entity will be named Punjab National Bank.
After the amalgamation, PNB (combined entity) is likely to have a business mix of about ₹19-lakh crore as of March-end this fiscal, sources said.
Similarly, the group comprising the chief executives of Union Bank of India (anchor bank) and Andhra Bank and Corporation Bank (amalgamating banks) separately met the Finance Minister for the review.
Sitharaman is also understood to have reviewed the communication strategy that will be adopted by the amalgamating banks with clear message for customers, media, analysts, investors and employees.
The other consolidations proposed are the merger of Syndicate Bank with Canara Bank and the amalgamation of Allahabad Bank with Indian Bank.
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