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Four Public Sector Banks To Merge! Why?
By: Tupaki Desk | 5 Jun 2018 8:00 AM GMT
Following the success of SBI's merger, Centre is now toying with the idea of merging as many as four Public Sector Banks (Bank Of Baroda, IDBI Bank, Oriental Bank and Central Bank). If the plan works, India's second largest bank with a combined asset of Rs 16.58 trillion will be created.
For the financial year 2017-18, A combined loss of Rs 21,646.38 crore has been reported by these four banks.
On April 1st last year, Centre merged Five Associate Banks & Bharatiya Mahila Bank with State Bank of India (SBI). This move ensured a spot for SBI in the list of Top 50 Biggest Banks in the World.
Centre has been relying on merger of banks to address loan issue. While huge number of loans issued were yet to be cleared, Demand for New Loans has fallen. This is why percentage of bad loans to total loans kept increasing. Particularly, Corporates haven't been repaying the loans they obtained from Government-owned Banks amounting to Rs 8.9 lakh crore.
For the financial year 2017-18, A combined loss of Rs 21,646.38 crore has been reported by these four banks.
On April 1st last year, Centre merged Five Associate Banks & Bharatiya Mahila Bank with State Bank of India (SBI). This move ensured a spot for SBI in the list of Top 50 Biggest Banks in the World.
Centre has been relying on merger of banks to address loan issue. While huge number of loans issued were yet to be cleared, Demand for New Loans has fallen. This is why percentage of bad loans to total loans kept increasing. Particularly, Corporates haven't been repaying the loans they obtained from Government-owned Banks amounting to Rs 8.9 lakh crore.
