The merged entity of Punjab National Bank, Oriental Bank of Commerce and United Bank of India will retain the role of the State Level Bankers’ Committee in five states and one union territory, including Bengal.
At present United Bank of India is the SLBC convenor of Bengal and Tripura. Oriental Bank of Commerce is the convenor in Delhi, while Punjab National Bank plays the role in Punjab, Haryana and Chandigarh.
“The amalgamated entity will continue to remain the SLBC convenor in all (current) locations,” said Ashok Kumar Pradhan, managing director and CEO of United Bank of India. SLBC plays a key role in forming the annual credit plan for the state.
The board of Oriental Bank of Commerce and United Bank of India are set to meet on September 18 to approve the merger, while the board of Punjab National Bank has already cleared it.
After the board approval the merger will need legal and regulatory compliances that are expected to come in by March 2020 with the amalgamated bank coming into operations from April 1, 2020. The process of appointing merchant bankers for determining parameters such as valuation and swap ratio will soon be done, according to officials of all three banks.
“The amalgamation process will take some time and the new entity will start functioning from April 1, 2020. In the interim period, the individual banks will continue to operate independently,” said Pradhan.
The merged unit is likely to have a new name with a total business volume of Rs 18 lakh crore, which is around 1.5 times that of PNB.
The three banks held a customer meet here, which was attended by Chander Khurana, general manager of PNB, and Binay Kumar Gupta, general manager of Oriental Bank of Commerce. The lenders said there will be no retrenchment of staff in the merged entity.
Pradhan later told reporters that the combined staff strength after the amalgamation will be 1 lakh and the entity will have 11,400 branches.
“The merged entity will be adequately capitalised and comply with Basel requirements,” Pradhan said. The average net NPA of the three banks is 6.61 per cent, which is expected to fall below 6 per cent after the amalgamation.