Excelsior Correspondent
JAMMU, Jan 3: All India Bank Officers’ Confederation (AIBOC) has condemned the decision of Union Cabinet to amalgamate Vijaya and Dena Bank with Bank of Baroda.
A handout of the Confederation stated that Finance Ministry has yesterday made it clear that the amalgamation will obliterate Vijaya Bank and Dena Bank which were in existence for over 87 and 80 years respectively.
“The merger is more particularly an unkindest cut for Vijaya Bank, as it is among the best performing public sector banks, in most of the financial parameters. It is noteworthy that the amalgamation scheme approved by the Cabinet has remained totally silent on the large quantum of NPAs accumulated by the Dena Bank and Bank of Baroda and does not offer any roadmap on recovering stressed assets. Rather, the Cabinet has relied on the imaginary ‘synergies’ which will enhance the operational efficiency of the amalgamated entity. Merging the banks brings in more trouble as the organisation becomes too huge to pay attention to ailments they have. It is also pertinent to note that mergers and acquisitions of banks have not met success in any part of the world including our country,” the handout mentioned.
It further stated: “It is also a matter of concern to note, the hurry in which the proposed mergers are being pushed through, Government has out rightly violated the extant provisions codified under Banking Regulation Act, 1949 and Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980, which has been challenged by AIBOC in Delhi High Court.”
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