Relevance – Initial (about the consolidation of PSB and its benefits) + Mains
(GS III Economic Development)
whats’s the news
Union Cabinet approves mega consolidation of ten PSBs in four
Which includes –
(A) amalgamation of Oriental Bank of Commerce and United Bank of India
Punjab National Bank
(b) Amalgamation of Syndicate Bank with Canara Bank
(c) Amalgamation of Andhra Bank and Corporation Bank with Union Bank
Of india
(d) Amalgamation of Allahabad Bank with Indian Bank
To know! More about amalgamation and its benefits
.20 amalgamation will take effect from 1.4.2020 and will result in
Build seven big PSBs
Compar mega consolidation will help make banks comparable in scale
Able to compete effectively in global banks and India and
Globally. Large scale and synergy through consolidation will increase costs
Benefits that should enable PSBs to increase their competitiveness and
Affects the Indian banking system positively.
Am consolidation will also provide incentives to the amalgamated entities
Enhance their ability to support and leverage large ticket-size loans
Competitive operations based on greater financial capacity.
Adoption of best practices in amalgamating institutions will be enabled
Banks improve their cost efficiency and risk management, and also
To promote the goal of financial inclusion through wider reach.

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