Few quarters ago, the Modi Government has unleashed it’s mandate to consolidate Indian banking infrastructure. On such continuation, the Union government has decided to merge Bank of Baroda, Vijaya Bank and Dena Bank. This would be the second big merger in the banking sector after the merger of SBI associate banks with the SBI. “We have decided to merge Dena Bank, Vijaya Bank and Bank of Baroda. The merger of the 3 banks will make this the third largest bank of the country,” Financial Services Secretary Rajiv Kumar was quoted.
Announcing the decision of merger, Union Finance Minister Arun Jaitley told media in Delhi today, “Government had announced in the budget that consolidation of banks was also in our agenda and the first step has been announced.”
Key points of the Merger
- The merged banks will be the third largest bank in India.
- The merger will create a strong competitive bank with economies of scale.
- The merger will provide synergies for the network, low-cost deposits and subsidiaries.
- The merger will lead to a substantial rise in customer base, market reach, operational efficiency, a wilder bouquet of products and services for customers.
- Employees interests will be protected.
From the Employees Perspective
The employees of the three banks should not worry about their career in the wake of the merger announced by the government. “No employee will face any service conditions which are adverse in nature. The best of the service conditions will apply to all of them,” Jaitley said. The Ministry of Finance also tweeted that the interest of the employees will be protected.
The amalgamation of Bank of Baroda, Vijaya Bank and Dena Bank will create India’s 3rd largest globally competitive Bank. Further, according to Jaitley, the amalgamation of the three banks will increase the banking operations. He said that no employee will face any service condition adverse to present conditions.