Public sector lender Indian Bank is likely to complete its merger with Allahabad Bank by the end of current fiscal, said Padmaja Chunduru, Managing Director, Indian Bank.
Last week, the centre’s announced its proposal pertaining to the consolidation of 10 public sector banks into four mega state-owned lenders, including amalgamation of Allahabad Bank with Indian Bank.
“We have to go to board first…there is a process to follow. In the next few months, boards of both banks should complete the process. I expect that all the process should ideally be over by March 31,” said Chunduru.
Indian Bank last week received intimation from the Ministry of Finance stating that the Alternative Mechanism after consultation with the Reserve Bank of India has cleared a proposal for the merger.
Reacting on the merger, she said that the merger of Indian Bank and Allahabad Bank will create a robust entity with a pan-India presence.
Currently, Indian Bank has a visible existence in South India whereas Allahabad Bank has higher presence in the northern and eastern India.
The merger will help in leveling up both banks’ business, due to corresponding networks as currently both use the same CBS platform (BaNCS), thereby facilitating quick realisation of gains, she said.
The amalgamation will create the 7th largest public sector bank with a business of Rs 8.08 lakh crore (approx 1.9 times of pre-merged Indian Bank). It will have a nationwide presence spread over 6,100 branches with about 43,000 employees.