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PSU bank mergers to take effect on 1 April

The merger of 10 public sector banks into 4, announced by the government, will come into force on 1 April. The Reserve Bank of India said in statements that the branches of the merging banks will operate as branches of the banks in which these have been amalgamated. While bank officers’ unions had represented to the government to differ the mergers in view of the lockdown in the wake of coronavirus outbreak, finance minister Nirmala Sitharaman reiterated that the mega bank consolidation plan was very much on track and would take effect from 1 April. The merger scheme envisages the creation of a stronger Punjab National Bank into which Oriental Bank of Commerce and United Bank of India will be merged; Canara Bank, into which Syndicate Bank will be merged, Indian Bank into which Allahabad Bank will be merged and Union Bank of India into which Andhra Bank and Corporation Bank will be merged. As per the scheme, all the branches of Oriental Bank of Commerce and United Bank of India will operate as branches of Punjab National Bank, branches of Syndicate Bank as that of Canara Bank, those of Allahabad Bank as those of Indian Bank and those of Andhra Bank and Corporation Bank as those of Canara Bank. RBI also said customers, including depositors of merging banks will be treated as customers of the banks in which these banks have been merged.

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