Union Cabinet Approves Merger Of Dena Bank, Vijaya Bank With Bank of Baroda

New Delhi: The Union cabinet on Wednesday gave its go head to merger of public sector lenders Dena Bank, Vijaya Bank with Bank of Baroda (BoB).

Union Minister Ravi Shankar Prasad said the merger will make BoB the third largest bank in the country after the State Bank of India and HDFC Bank in terms of market cap and a “globally competitive entity”.

The merger will allow the combined entity more lending power, he said, adding that there will be no retrenchment of employees as the employees of Dena and Vijaya banks will be transferred to BoB.

“There will be no effect on their service and working conditions,” the Union Minister assured.

This is the first three-way merger in the public sector banking. Prior to this, the State Bank of India had merged five of its subsidiary banks with itself and took over Bharatiya Mahila Banks.

In September last year, the Centre had announced the merger of these three banks as a part of its strategy to promote consolidation in the sector marred by non-performing assets (NPAs).

However, nine bank unions had been opposing this three-way merger and called a nation-wide bank strike in December last year against the decision.

(With input from agencies)