Punjab Nationwide Financial institution, Oriental Financial institution of Commerce and United Financial institution could be merged right into a consolidated financial institution, which is able to grow to be the second largest state-controlled financial institution within the nation.
Union Bank, Andhra Bank and Corporation Bank will be merged: Apart from the above, Sitharaman said that Union Bank, Andhra Bank and Corporation Bank will be merged to create India's 5th largest entity, while Canara Bank will be merged with Syndicate Bank to form 4th largest government bank.
The Finance Minister further said that the Bank of India and Central Bank of India would remain independent.
Addressing a press conference at a city hotel here on Thursday evening, Sitharaman said even though India is a fast-growing economy in the world, the government recently announced a few measures after the industries expressed fear and apprehension about problems in the present economy.
She said that 14 out of 18 Public Sector Unit banks were running in profits.
IOB will continue its presence in the south, UCO Bank with its presence in the east will continue with Rs. 3.17 lakh crore of business.
The government on Friday announced multiple bank mergers, but assured that the employees of the banks would all be absorbed.
Union Bank of India, Andhra Bank and Corporation Bank to be merged. The bank reported a capital adequacy ratio of 9.77 percent at the end of the first quarter.
The FM added that the mergers will not have any effect on customers.
Indian Overseas Bank - Rs 3,800 crore. The announcement made by Sitharaman covers 10 PSBs which will together form second, third, fourth and seventh largest PSB networks in the country.
Professionally managed banks Sitharaman also promised to ensure that these merged banks will be run professionally while shedding some of bureaucratic pains that have dogged public sector institutions.
Immediately, she introduced a slew of measures to extricate the public-sector banking sector from the disaster brought on by the unsafe loans.
The gross bad loans of public sector banks have come down to 7.9 lakh crore rupees from 8.65 lakh crore rupees in December past year.
The Finance Minister said that for Non-Banking Financial Companies (NBFCs), a partial guarantee scheme has already been executed and four NBFCs have already found liquidity solution via PSBs in the last one week. "Canara Bank will be merged with Syndicate Bank", she adds.