RBI has approved the voluntary amalgamation of two Maharashtra-based co-operative banks, wherein Pune-based Cosmos Co-operative Bank will acquire Mumbai-based Sahebrao Deshmukh Co-operative Bank.
The merger will come into effect from September 26, 2023, post which branches of Sahebrao Deshmukh Co-operative Bank will function as branches of Cosmos Co-operative Bank, the central bank said.
Shareholders of Cosmos Bank had in March 2023 approved the merger with Sahebrao Deshmukh Sahakari Bank and Maratha Sahakari Bank. Cosmos Bank’s Chairman CA Milind Kale had then said that the bank is looking to expand with these two acquisitions as its presence in Mumbai will grow significantly.
Sahebrao Deshmukh Co-op Bank has 11 branches and a business set-up of around ₹244 crore. Maratha Sahakari Bank has 7 branches and business of about ₹162 crore. The acquisition of the latter has been completed, following which Cosmos Bank has 159 branches in seven states.
The lender will further look to acquire more urban cooperative banks into its fold, with the objective of expand its network to 200 branches, Kale had said in May 2023. Till date, the bank has acquired 16 urban co-operative banks.
As of March 2023, Cosmos Bank had balance sheet stood at ₹30,745 crore compared with ₹28,815 crore a year ago. Gross NPA ratio of the bank improved to 4.8 per cent from 6.86 per cent, and net NPA ratio to 1.74 per cent from 4.74 per cent. It posted a net profit of ₹213 crore for FY23, up from ₹84 crore in FY22, and had a capital adequacy ratio of 13.55 per cent.