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Cabinet approves merger of Dena Bank, Vijaya Bank with Bank of Baroda

With the merger, Bank of Baroda (BoB) will become the third largest bank after State Bank of India and ICICI Bank

Wednesday January 2, 2019 10:48 PM, ummid.com News Network

bank Merger News Today

New Delhi: The Modi government in New Delhi Wednesday approved the merger of Dena Bank and Vijaya Bank with Bank of Baroda (BoB) despite the opposition by bank unions who went on a strike last Wednesday protesting against the decision.

With the merger, Bank of Baroda (BoB) will become the third largest bank after State Bank of India and ICICI Bank. The government said the decision was taken to make it a globally competitive lender.

"There will be no impact on the service conditions of the employees and there will be no retrenchment following the merger," Union Law Minister Ravi Shankar Prasad told reporters about decisions taken by the Union Cabinet.

"The amalgamation will help create a strong globally competitive bank with economies of scale and enable realisation of wide-ranging synergies. Leveraging of networks, low-cost deposits and subsidiaries of the three banks has the potential of yielding significant synergies for positioning the consolidated entity for substantial rise in customer base, market reach, operational efficiency, wider bouquet of products and services, and improved access for customers", the government said.

As per the cabinet decision taken today, Vijaya Bank and Dena Bank are transferor banks and BoB is transferee bank. "The scheme shall come into force on April 1, 2019", the government said.

"Upon commencement of the scheme, the undertakings of the transferor banks as a going concern shall be transferred to and shall vest in the transferee bank, including, inter alia, all business, assets, rights, titles, claims, licenses, approvals and other privileges and all property, all bor­rowings, liabilities and obligations", the government said.

The move follows top lender State Bank of India (SBI) last year merging with itself five of its subsidiary banks and taking over Bharatiya Mahila Bank, a niche state-run lender for women.

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