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  • Category: Miscellaneous

    What is the use and role of merging banks?

    State Bank of India merged many banks in it. After that some more banks also merged to form a group. Now Dena bank, Vijaya bank and Bank of Baroda merging into one bank. Next turn is Andhra bank, Punjab National bank and Oriental bank of Commerce is merging into one bank. In AP and Telangana Andhra Bank is one of the most popular bank running with lot of branches and profit. Why Central government is initiating banks to merge and reduce their number? SBI has announced it is no more ready to merge any other banks in it and also stated it leads to monopoly. Usually when there is a lot of competition is there between the banks the services to the customers become more friendly. At present SBI has following strict rules in maintaining higher minimum balance (Rs.3000) and other service charges than the other banks. Is it the way for government to reduce work force in banks and NPA's? As India is a big country with large population there is a need of more bank branches. Then what is the actual role of merging?
  • #648827
    What I feel that there is inner agenda with the present government to less the strength of public sector banks with merger and amalgamations there by they can have better control over lending and recovery. Moreover the money on staff, infrastructure would be hugely saved. There need not be further expansion of Individual banks as done earlier and with such mergers each the consolidated bank becomes big and the lending capability also increases with best service. Probably NDA taking grudge against Congress which during Indira Gandhi period created 14 Nationalized banks.
    K Mohan
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

  • #648852
    Sincerely writing this. As a nation, we need not have different banks with different rules and regulations. The interest rate varies from bank to bank.

    "One Nation, one Bank" should be the policy. It will be easy to manage and control the money flow. With the 14 nationalized banks, people have account in all the banks. Hence monitoring of a persons money accountability becomes difficult.

    I welcome the merger of banks. In due course, the number of banks in India will be reduced substantially. I also recommend that each and every village should have a bank of that major bank.

    No life without Sun

  • #648854
    The merger of banks is beneficial. Mainly overheads. The top people's salary will be very high. By merging three banks, three MDs are not required. Three separate boards are not required. In the same way, the policies and procedures will be uniform. In small villages, I have seen 2 to 3 banks with staff without much work. In such a case, excess staff will be reduced. So there is some saving of money as well as time also. Lesser the people, lesser the corruption also.
    The monitoring of accounts of different people will be easy. Coming to the question monopoly, all the banks are monitored by RBI and almost all banks will have similar rules and regulations. So it may not make much difference. The same person having different accounts in different banks is also a waste of time and money. I feel merging the banks will be a better option.

    drrao
    always confident

  • #648863
    I welcome the merger of banks. In due course, the number of banks in India will be reduced substantially. I also recommend that each and every village should have a bank of that major bank.


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