In a statement the body questioned consolidation of banks. “As per the announcement, Indian Bank will be merged with Allahabad Bank; Punjab National Bank, Oriental Bank of Commerce and United Bank of India to be merged; Union Bank of India, Andhra Bank, and Corporation Bank are to be merged and lastly Canara Bank and Syndicate Bank are also to be amalgamated as one.”
Dilip Kumar Roychoudhury Secretary AIBOC, Assam State Unit stated the move will deprive the masses from banking services. Terming the decision as unmindful since it has no logic or rationale. “Neither, it is the case that a weak bank is merged with a strong one nor geographically compatible banks are being merged to at least find a justification”.
He added, “ United Bank, headquartered in Kolkata is being merged with the Delhi-based Punjab National Bank, while Syndicate Bank is being merged with Canara having a network in same geographical areas. Further, the government has come out with merger proposals at a time when the economy is passing through rough weather.”
He added that the government itself is attempting to destabilize the finance and economy.
“History bears the testimony that in the process of merging the Banks, several branches of both SBI, as well as the Bank of Baroda, have resulted in closures with thousands of employees forced to take voluntary retirement from the Bank. As an impact of merger it is the NPAs inherited by the merged bank resulting in increase in gross NPA which will surely act as an impediment for credit offtake further previous experience shows, it takes at least 2-3 years to stabilize the process of merger and the employees to get acclimatized with the changed environment which further causes retardation in growth.”