With the merger of the Vijaya Bank, Dena Bank and Bank of Baroda everyone is in question mark state of what will this merger offers. In this article, we will resolve each and every query that might be coming into your mind like job security, Bank Shares etc.
No Loss of Jobs for the Bank Employee
One of the major concern any merger brings is “do the employee has job security after the merger”. For the employees of all three banks it is good news as the merger is not affecting the job of the people working in all three banks as stated by Arun Jately (Finance Minister). The employees of Vijaya Bank and Dena Bank will be shifted to the Bank of Baroda staff and the salary of the employee of the two banks will be provided under the Bank of Baroda.
With the announcement of Swap ration of the merger banks the investors of the Vijaya Bank and Dena Bank may experience some losses whereas the BoB shares are not affected much. BoB announced the shareholder can get 402 and 110 shares of BoB for every 1000 shares of Vijaya Bank and Dena Bank respectively.
Who will be the of CEO Merged Bank
The biggest question after the job security is “Who will be the CEO?”, Vijaya Bank, Dena Bank and Bank of Baroda has their own CEO as RA Shankara Narayan, Karnam Sekar and PS Jayakumar respectively. It is not revealed by any sources that who will be the leading head of the merged bank.
How Much Time Bank Merger Will Take
With the approval from the cabinet, the merger of the bank is in the planning phase. The process of the merger will began from April 1, 2019, after the end of the financial year. The merger can take up to 6 months as it includes staff integration, capital ratio etc. the major challenge with the merger are those places where there are branches of the two banks at the same area.
Another major issue being the IFSC Code for the bank branches, with the merger of the bank the IFSC Code can be changed like how SBI merger with the associate bank changed the IFSC Codes of the Associate Banks therefore, the process of merger is not easy and challenges can be expected as the process continues hence, the operation can take 6 months or more but all the banking operation of all three banks will be available to use that includes NEFT, RTGS transactions, missed call balance inquiry Number etc.
The Third Largest Bank in India
With the amalgamation of all three banks, India is getting its third largest bank leaving behind ICICI and Punjab National Bank. The top two Bank in India being SBI and HDFC Bank. The merger of the bank has to offer a lot of benefits that includes the wider coverage of the customers from all the regions. All three banks have some strong point of them own, with the merger the strength of the three banks is added to a single bank and the area where the bank lacks behind is overlapped by the other bank. The short-term negative effect can be seen from this merger as the Dena and Vijaya Banks shares dropped and the shareholder has to take the loss of Rs. 3-4 per share but it will be beneficial for the long-term.