The announcement to amalgamate three public sector banks comes as a surprise and one hopes that such a decision has been taken cautiously. As per the report, the amalgamation is set to take place within the next few months post the parliamentary panel’s approval. It needs to be seen how quickly such a decision will be implemented as the government is left with just one or two parliament sessions before the next general elections.
The amalgamation has been attributed to curbing mounting NPA mess, weak lending scenario and in a bid to aid banks covered under the prompt corrective action. However, what will be worth watching is how the government, Reserve Bank of India and Bank Boards Bureau will convince the third such bank restructuring exercise to the end customers, the employees, the banking union to accept and move into such an entity. They need to ensure that the customers are moved to the new entity without much hassle.
Varun S D Bengaluru
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