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Last Updated : Aug 30, 2019 09:34 PM IST | Source: Moneycontrol.com

Bank merger: Indian Bank to merge with Allahabad Bank to form India's 7th-largest PSB

Indian Bank and Allahabad Bank will have a total business of Rs 8.08 lakh crore which is around 1.9 times of Indian Bank before consolidation

Finance Minister Nirmala Sitharaman today announced that Allahabad Bank will be merged with Indian Bank to form India's seventh-largest public sector bank, as part of a mega consolidation drive that will see 10 banks being merged into 4 entities.

comparision after bank mergers_for website

Indian Bank and Allahabad Bank will have a total business of Rs 8.08 lakh crore which is around 1.9 times of Indian Bank before consolidation. The banks will aim at strong nationwide presence in South, North and East. Combined lending capacity of the banks is also expected to improve the business.

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The FM said that the consolidation of the state-run banks will give banks benefits of scale and synergy, as well as strong national presence and increased risk appetite.

Allahabad Bank has strong presence in east India while Indian Bank is a southern India focused bank.

Both the banks have same core banking solution (CBS) platform, BaNCS.

 Indian Bank Allahabad BankAmalgamated bank
 Total Business (in crore Rs.) 4,29,972 3,77,887 8,07,859
 Gross advances (in crore Rs.) 1,87,896 1,63,552 3,51,448
 Deposits (in crore Rs.) 2,42,076 2,14,335 4,56,411
 CASA ratio 34.71 % 49.49 % 41.65 %
 Domestic branches 2,875 3,229 6,104
 PCR 49.13 % 74.15 % 66.21 %
 CET-I ratio 10.96 % 9.65 % 10.36 %
 CRAR ratio 13.21 % 12.51 % 12.89 %
 Net NPA ratio 3.75 % 5.22 % 4.39 %
Employees19,60423,21042,814

The FM made merger announcements with three more entities:

- Oriental Bank of Commerce and United Bank of India would be amalgamated into Punjab National Bank.

- Syndicate Bank will be amalgamated into Canara Bank

- While Andhra Bank and Corporation Bank will be combined with Indian Bank.

In place of fragmented lending capacity with 27 PSBs in 2017, now 12 #PSBs post consolidation. बड़े बैंक अब अपना लक्ष्य रखेंगे global मार्केट पर, मँझले बैंक बनेंगे राष्ट्रीय स्तर के और कुछ बैंक स्थानीय नेतृत्व करेंगे। @PMOIndia @FinMinIndia @PIB_India #PSBsFor5TrillionEconomy pic.twitter.com/Z4dcyZOG5f

In 2017, where there were 27 PSBs, there are now only 12 PSBs.
First Published on Aug 30, 2019 06:06 pm
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