Money & Banking

No changes to bank merger plans

G Naga Sridhar (byline request) Hyderabad | Updated on March 27, 2020

Despite concerns over the spread of coronavirus (Covid-19), 10 public sector banks will become four from April 1. There is no change in the merger plan and things are moving in the right direction.

“The amalgamation process has been initiated. Our top priority is to ensure minimal disruption to customers during the transition period,” G Rajkiran Rai, Managing Director and CEO, Union Bank of India, told customers in a message.

As per the earlier announcement by the government, Oriental Bank of Commerce and United Bank of India will be merged with Punjab National Bank, while Andhra Bank and Corporation Bank will be amalgamated with Union Bank of India.

Syndicate Bank and Allahabad Bank will be merged with Canara Bank and India Bank, respectively. For all banks, board approvals and swap ratios have already been obtained.

After amalgamation, the banks to be merged will lose their identify and there will only be Punjab National Bank, Union Bank of India and Canara Bank.

The merger will have many implications for customers, but banks have now taken to digital route to reassure customers.

“We are sure that you will be benefitting from this amalgamation. If at any time you have any issue, our call centers, help lines and grievance redressal portals will function in the normal manner,” said LV Prabhakar, MD and CEO of Canara Bank, and M Mahapatra, MD and CEO, Synidcate Bank, in a joint communication to customers.

It has also been clarified that it will be business-as-usual for the customers of these banks.

“While bigger issues have been addressed, there are operational issues because of the lockdown. We have been asked to change signboards immediately with new name of the bank, but it cannot be done now in all places as workers are not available,” said a senior official with Andhra Bank. Rebranding, branch rationalisation, allotment of new IFSC codes, and redeployment of human resources across amalgamated bank branches will surely get delayed beyond the expected period, say bankers. Some software integration challenges will remain in view of the difference in versions being used by some banks.

Published on March 27, 2020

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