The amalgamation would be the first-ever three-way consolidation of banks in India, with a combined business of Rs 14.82 lakh crore, making it the third largest bank after SBI and ICICI Bank.
Modi government on Wednesday approved the merger of Dena Bank and Vijaya Bank with Bank of Baroda. The merged entity would create the country's third largest lender. Besides, the boards of the three banks have also cleared the share-swap ratio for the proposed amalgamation.
The amalgamation would be the first-ever three-way consolidation of banks in India, with a combined business of Rs 14.82 lakh crore, making it the third largest bank after SBI and ICICI Bank.
It should also be noted that the merger of Dena Bank and Vijaya Bank with Bank of Baroda would also create the second largest public sector bank. Post this merger, the number of PSU banks will come down to 19.
But what will happen to the employees and the customers? Below wehave answered all the questions related to the latest development.
1. What will happen to employees?
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There will be no impact on the service conditions of the employees and there will be no retrenchment following the merger, assured Law Minister Ravi Shankar Prasad.
2. What will happen to shareholders?
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As per the Scheme of Amalgamation announced by Bank of Baroda, shareholders of Vijaya Bank would get 402 equity shares of BoB for every 1,000 shares held in the bank.
In case of Dena Bank, the shareholders would get 110 shares of BoB for every 1,000 shares owned in the bank.
The scheme would come into into force on April 1, 2019.
3. Decision after strike
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The official confirmation came after bank unions concluded their 5-day long strike against the merger of Bank of Baroda with Vijaya Bank and Dena Bank.
4. Go ahead in September
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The government had in September last year introduced its plan to merge the three lenders as part of efforts to tackle a pile of bad loans plaguing the banking sector
