Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: due date for vat payment :: TDS :: list of goods taxed at 4% :: TAX RATES - GOODS TAXABLE @ 4% :: VAT Audit :: Central Excise rule to resale the machines to a new company :: form 3cd :: VAT RATES :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ACCOUNTING STANDARD :: empanelment :: articles on VAT and GST in India :: ACCOUNTING STANDARDS :: cpt :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes
« Mergers and Acquisitions »
 The Role Of Brand In Petroleum Mergers And Acquisitions
 Mergers and Acquisitions: What Happens After the Announcement?
 Agency mergers and acquisitions continue to be strong for first-half 2016
 The Intricacies Of Financial And Legal Relationships In M&A
 3 integration considerations for Mergers & Acquisitions
 Mergers and acquisitions take centre-stage as funding for start-ups dries up
 Mergers and Acquisitions reach highest quarterly value in India
 18 digital health exits (mergers, acquisitions, and IPOs) in Q3 2016
 Number of mergers and acquisitions rise in 2016, Experian finds
 Indian startups are more willing than ever to acquire and be acquired
 India’s mergers and acquisitions reaches highest quarterly value in Q3 2016: Report

Mergers & actualities
January, 06th 2010

The submission of a white paper to the government on consolidation sets up an interesting new phase for the countrys public sector banks. Global consultants McKinsey & Co and Ernst & Young had been appointed by the finance ministry to suggest possible PSBs that could be amalgamated to create larger and stronger banks.

They have suggested four combinations, with each proposed entity accounting for a market share of 7-8 per cent. (By way of comparison, the State Bank of India has a market share almost 30 per cent, with Punjab National Bank ringing in second with a share of just 5.2 per cent.)

The suggestions are reported to have taken into consideration factors such as cultural synergies, geographical presence and profitability, besides, of course, market share.

The white paper is just the first step in the endeavour to enable PSBs to command economies of scale and scope and while the process can be complicated, the paper should also serve to immediately provoke an assessment on ways in which PSBs, whatever their size, can be made more responsive to customers needs. That is, bank consolidation cannot be a substitute for banking sector reform.

In the next step, five banks Punjab National Bank, Canara Bank, Union Bank of India, Bank of Baroda and Bank of India will submit a detailed report to the government in March, with each suggesting a suitable merger candidate.

After studying these reports, the finance ministry will write up a possibly final scheme for bank consolidation, which would then be put to the Reserve Bank of India for approval. Thereafter, concrete steps may be taken by the government to actualise the proposals.

It is still early days, and drawing up plans that address duplication and redundancies will be complicated and would determine the effectiveness of the proposed mergers. But with this first step, the white paper, the government should make it clear that decision-making will be participatory and will not be blanketed upon banks.

There is, through it all, the big question. Will the government muster the political will to pull off bank consolidation? Mergers are always stressful processes for employees, and given the abandon with which public sector personnel take recourse to strikes, banks need to prepare their staff for the deliberations ahead.

They can only accomplish this if the government demonstrates enough resolve at even this early stage.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
SEO Services SEO LLC e-boost Search Engine Optimization Services Internet Marketing Services Website Placement Services On-site Webs

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions