Thread by @someshjha7

Exclusive: After announcing the merger of 10 state-owned banks into 4 about 6 months ago, the govt. still seems to be unsure about the move.

As the deadline for merger approaches, banks are asking: where is the notification?

@humsitweets & I write:
business-standard.com/article/compan…

The answer: PM Modi is not convinced about the merger of Bank of Baroda (BoB) & wants to know the outcome of the exercise in detail. The FinMin is set to give a presentation soon.

In the latest quarterly results, BoB had slipped into losses.

bloombergquint.com/business/bank-…

Bank of Baroda had taken over Dena Bank and Vijaya Bank in April 2019. The move was announced in September 2018. Till date, the technological integration of the three banks hasn't happened. The deadline to move all 3 banks on same technological platform was December 2019.

The amalgamation of 10 banks was announced in Aug. 2019. In case of BoB, the govt had moved timely with the notification & by now even the swap ratio was finalised by the boards after following due processes. The Union Cabinet hasn't yet approved merger notification for 10 banks.

Bank of Baroda took 49 days to complete the process of swap ratio after the government's notification was out. Top executives of 10 banks going through the merger process fear meeting April 1 deadline would be an uphill task from now as one-and-a-half month is left.

Another cause of concern for the government is how the impact of the merger of 10 PSBs will play out on the economy, which is going through a period of stress. Banks undergoing amalgamation are already witnessing some amount of slowdown at the branch level.

The FM's response to @bsindia on a delay in merger:

"I don't want to give a personal response. I read your piece. Very elaborate. I don't see any reason to hold back or any reason particularly causing a delay in the notification. You will hear it as & when a decision is made."