Government merges 10 PSBs to form 4 large banks

In consultation with the chiefs of public sector banks (PSBs), the Finance Ministry has created a roadmap to reviving the state-owned bank and consolidation smaller PSBs to form four large banks with increased reach and competitive advantage.

Finance Minister Nirmala Sitharaman briefed the media about the health of PSBs post market hours on Friday.

Highlights of PSBs

• 14 PSBs in profit in Q1FY20, loan recovery hit record numbers

• Eight PSBs have launched repo-rate linked products.

• Documents submitted for availing loans being returned at a faster pace, within 15 days of loan repayment.

• Prudent monitoring of large loans, specialised agencies to monitor loan above Rs. 250 crore

• Appoint of Chief (MDs) of large PSBs from market / non-government organisation, selection for higher designation through Bank Board Bureau

Snapshot of consolidation

• PNB, OBC, United Bank to merge to form second largest public sector bank

• Canara Bank and Syndicate Bank to merge

• Union Bank, Andhra Bank and Corporation Bank to merge

• Indian Bank and Allahabad Bank to merge

Meanwhile, as market was rife with chatter that the government is looking to consolidate PSBs, the benchmark BSE Sensex closed at 37,332.79, up by 263.86 points or 0.71 per cent, while Nifty50 closed at 11,023.25, up by 74.95 points or 0.68 per cent on Friday. The popular index Nifty Bank closed at 27,427.85, up by 122.65 points or 0.45 per cent.