PNB has identified 23 internal working groups and will soon float Request for Proposals (RFPs) to appoint a consultant for restructuring products and services that are best-suited for the customers of the merged entity.
Punjab National Bank (PNB), the anchor bank for amalgamation with Oriental Bank of Commerce (OBC) and United Bank of India, is planning to create new business verticals and open up growth options for employees of all the merging banks after consolidation. There will be no layoffs or Voluntary Retirement Scheme (VRS) offers due to the merger, the bank said.
The bank has also identified 23 internal working groups and will soon float Request for Proposals (RFPs) to appoint a consultant for restructuring products and services that are best suited for customers of the merged entity.
"The banking products and processes need to be redefined and there will be different types of verticals and the handling will have to be different. So, for that we are engaging a consultant," said Sunil Mehta, Managing Director and Chief Executive Officer, PNB.
"We will also provide in-house inputs and create an organisational structure where we don't have to lose manpower, but we capitalize on them and create new verticals, which is a win-win situation for employees and customers," he said.
Since the government announced plans to consolidate 10 public sector banks into four from next financial year, there have been concerns over branch and staff retrenchments. For now, the government has ensured there will be none.
Mehta said the bank will redeploy employees to create a stronger marketing vertical when functions like loan application processing get automated.
"Public sector banks do not have robust marketing structures, whereas most of the private sector banks have. So, once you merge these banks, you can find some people for marketing," Mehta said.
With a combined workforce of a lakh employees post consolidation, the anchor bank is trying to allay merger blues by sugarcoating the transition.
Mehta said the merger opens up the opportunity for employees of OBC and United Bank to get foreign branch postings, which was not an option for them due of lack of overseas presence of the two merging banks.
OBC and United Bank have 21,729 and 13,804 employees, respectively, while PNB has 65,116 employees as of March 2019. Currently, PNB is present in Hong Kong, Dubai, UK, Bhutan, Nepal, and Kazakhstan. However, it has one branch in Hong Kong, a branch and one representative office in Dubai. Rest of the overseas presence is in the form of subsidiaries and joint venture.
For customers, he said the bank will try to retain insurance partnerships if there are no regulatory hurdles. "We will make a case-to-case study and where we find the value we will retain those relationships if there are no regulatory challenges. But if there are regulatory challenges, we will do what's best in a commercial environment," Mehta said.
As per regulatory norms, a bank is not allowed to have tie-ups with more than three insurance partners in a single category.
PNB has identified 23 working groups that have members from all the three banks each to work on new products. These groups will compare the best features of each product and merge them into a single product best-suited for the new bank.The amalgamated bank will be the second-largest public sector lender with a business worth Rs 17.95 lakh crore and 11,437 branches.
The Great Diwali Discount!
Unlock 75% more savings this festive season. Get Moneycontrol Pro for a year for Rs 289 only.
Coupon code: DIWALI. Offer valid till 10th November, 2019 .