Merger of BoB, Vijaya, Dena Bank to improve efficiency, governance: Moody’s

Dena Bank, Vijaya Bank and Bank of Baroda to be merged to form India's third largest bank

Dena Bank, Vijaya Bank and Bank of Baroda to be merged to form India's third largest bank

Rajiv Kumar, Department of Financial Services Secretary, announced that the decision was arrived at after meeting of the "alternative mechanism" which was set up during a year ago to consider consolidation of the Indian Banking Sector. As a result, bank credit lending was becoming weaker and private sector investment was being affected.

Jaitley also clarified that no employee will face any service conditions which are adverse in nature. This will create the country's third-largest bank, and capital support will be provided to the merged entity by the government.

The merged entity which will be the third largest bank in the country after State Bank of India and HDFC Bank, will have a market share of about 6.8% by loans. These three have been languishing with business restrictions under Reserve Bank of India's corrective prescriptions and without much scope for growth in lending.

"Alternative mechanism under Finance Minister, Arun Jaitley suggests bankofbaroda, VijayaBankIndia & dena_bank to consider amalgamation; to create India's 3rd largest globally competitive bank", he tweeted on Monday evening.

"Though the consolidation move itself is negative and ushers in uncertainty, the proposed merger of Dena with stronger Vijaya is relatively better for BoB". "This took its toll on the economy", he said. "The best of the service conditions will apply to all of them", Jaitley said. Till then, the three banks will carry on functioning independently.

More than 870,000 without power as Florence lumbers inland
However, the surge is expected to be accompanied by large and destructive waves, regardless of when the storm arrives. Hurricane Florence will be one of the biggest storms to make landfall along the U.S. eastern seaboard in decades.

However, FM did not talk about the name of the new entity and said that it will be revealed later. Vijaya Bank shares traded at Rs 60.55, up Rs 0.75 and Dena Bank shares traded at Rs 19.10, with a gain of Rs 3.15 on the BSE.

Since the government is a majority owner in all three banks, it seems more likely than not that the merger will be approved. Corporate loan book constitutes 60 percent of the total loan book for Bank of Baroda and only 17 percent is constituted by the retail loan book.

The grapevine was working overtime Tuesday, and Uco Bank was at the centre of the speculative talk. "Real picture of Non Performing Assets (NPAs) was only known in 2015, the UPA had swept NPAs under the carpet".

Allahabad Bank reported Rs 4,674 crore net loss for FY18 with the ratio of gross non-performing assets being at 15.96%. "The government is keen to take steps so that history isn't repeated as far as NPAs are concerned", he added.

Recommended News

  • Henry Cavill Will Reportedly No Longer Play Superman, Out At Warner Brothers

    Henry Cavill Will Reportedly No Longer Play Superman, Out At Warner Brothers

    A statement from Warner Bros . tried to play down any final decisions made about Cavill's future as the superhero. He followed up the portrayal in Batman V Superman: Dawn Of Justice (2016) and Justice League (2017).
    Apple's new 6.5-inch handset could be called the 'iPhone XS Max'

    Apple's new 6.5-inch handset could be called the 'iPhone XS Max'

    What features come with the iPhone XS camera? The same report compared Apple's approach to the iPhone 5C with its bright colors. The names are still a mystery, but for ease of understanding, we will tentatively call them the iPhone XS , XS Plus and X Lite.
    Donald Trump presidency called 'Crazytown' in new Bob Woodward book

    Donald Trump presidency called 'Crazytown' in new Bob Woodward book

    The latest book on the Trump White House paints a damning picture of the current presidency. "He just scurries around". And, not surprisingly, Trump was even more scathing about Attorney General Jeff Sessions in private than he is public.
  • Chinese telcos tease dual-SIM support on the upcoming iPhone

    Chinese telcos tease dual-SIM support on the upcoming iPhone

    Other rumors have claimed that the LCD 2018 iPhone would sell for about $699 making it much more affordable than the OLED models. A recent report has hinted that Apple is considering eliminating the "Plus" moniker and instead use "Max".
    Djokovic dismisses Del Potro to win U.S. Open

    Djokovic dismisses Del Potro to win U.S. Open

    Juan Martin del Potro, of Argentina, returns a shot to Novak Djokovic , of Serbia, during the men's final of the U.S. Ahead of the final, Del Potro had fired 68 aces during the tournament, winning 82 percent of his first serve points.
    Eagles hold off Falcons to begin title defense

    Eagles hold off Falcons to begin title defense

    If Matt Ryan could actually complete a touchdown pass in the red zone, Johnson probably would've been singing a different tune. Prior to kicking off the National Football League season, the Eagles celebrated the accomplishments of 2017 one last time.
  • Bills player claims cornerback Vontae Davis retired at halftime

    Bills player claims cornerback Vontae Davis retired at halftime

    Cornerback Vontae Davis, who signed a one-year, $5 million deal with Bills earlier this year, did something most only dream about. With the Bills down 28-6 at the half against the Chargers, Davis reportedly changed into street clothes and walked out.
    Darnold shakes off pick-6, guides Jets past Lions

    Darnold shakes off pick-6, guides Jets past Lions

    One of those interceptions was by Lee, who took it back 30 yards for a touchdown, the Jets' first defensive score in five seasons. It doesn't take a rocket scientist to know that's some really poor defense. " He didn't flinch ", Jets coach Todd Bowles said .
    Tesla (TSLA) plunges 6% amid new executive departures, Musk’s behavior during podcast

    Tesla (TSLA) plunges 6% amid new executive departures, Musk’s behavior during podcast

    Rogan pulled out a joint in the middle of the interview , leading Musk to wonder if it was a tobacco cigar or cannabis. The Model 3 starts at $35,000, although the cheapest one that can be purchased at present costs $49,000.
  • Shocking SA Crime stats explained on Breakfast

    Shocking SA Crime stats explained on Breakfast

    The majority of these were connected to gang-activities. 'The figures that always scare me are murder figures, ' he said. ANC chief whip Jackson Mthembu said the fight against crime required action by all South Africans.
    Gareth Southgate determined to turn England into world beaters

    Gareth Southgate determined to turn England into world beaters

    England reached the semi-finals in Russian Federation , but lost to Croatia and then fell to Belgium in the third-place game. Spain's easy-on-the-eye style began to pick holes in England as the likes of Isco, Alcantara and Saul Niguez took charge.
    Twitter permanently bans conspiracy theorist Alex Jones

    Twitter permanently bans conspiracy theorist Alex Jones

    It showed Jones verbally attacking CNN reporter Oliver Darcy , saying, among other things, "Those are the eyes of a rat". At one point, he said Darcy was "smiling like a possum that crawled out of the rear end of a dead cow".

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.