The formal merger of 3 Indian banks – Bank of Baroda, Dena Bank and Vijaya Bank – has happened on 1 April making the merged entity India’s third largest bank. It will have an advances base of Rs 6.6 lakh crore and a deposit base of Rs 8.7 lakh crore and some 10,000 branches and more than 84,000 employees. As a first step, the 3 brands will now consolidate under the Bank of Baroda banner and all customers of Dena Bank and Vijaya Bank will become customers of Bank of Baroda. All branches will be rebranded as well. This is second merger of state-run banks in the banking sector after State Bank had merged 5 of its associate banks and Bhartiya Mahila in April 2017. P.S. Jayakumar, MD and CEO of Bank of Baroda, who will be the MD and CEO of the merged entity said Bank of Baroda will now be the second largest bank in terms of network and customer base. He added that the effort now will be to build a stronger organization and collectively deliver more to the stakeholders than that of sum of individual entities. The diverse bouquet of products from the 3 banks, substantial investments made in technology will help in benefiting a wider customer base, he said. The central government is expected to provide Rs 5042 crore by way of funding to the merged entity. Bank of Baroda also said in a statement interoperability of key banking services across all branches would be introduced by April-end while technology integration is expected to be completed over 12-18 months, when customer accounts of all the 3 banks will be migrated to a single core banking system. As per the merger plan, shareholders of Vijaya Bank will get 402 equity shares of Bank of Baroda for every 1000 shares held and shareholders of Dena Bank will receive 110 equity shares of the bank for every 1000 equity shares held.
