Based on the recent cabinet approval for merging of Public Sector Banks in India, Finance Ministry has issued the notices and written letter to all heads of State run bank to set up a ministerial panel to facilitate consolidation in the public banking space. This communication is being made in order to activate the motion of bank consolidation process.
Main aim of setting up the in house merger panel to undertake an internal exercise for the best match and come up with the merger idea for the alternative mechanism (AM) set up for the purpose.
The work of ministerial panel is to analyse regional balance, geographical reach, IT compatibility, financial burden and human resource transition while firming up the merger proposal. After The proposals received from banks for in-principle approval to formulate schemes of amalgamation will be placed before the panel. In order to strength the merger, the government has exempted mergers of nationalized banks from seeking fair trade watchdog CCI’s approval.
Finance ministry official has informed that the proposed merger of various bank will be in few months.