The Reserve Bank of India will have the final say on bank mergers and acquisitions (M&A), said the Finance Minister, Mr Pranab Mukherjee, on Saturday.

Banking mergers and acquisitions will not come under the purview of the Competition Act or the Companies Act. The mergers and acquisitions of banks will be under the purview of the Banking Regulation Act, Mr Mukherjee said at the National Council Meeting of the Confederation of Indian Industry.

The RBI will get the power to approve bank M&As once the Banking Laws Amendment Bill gets enacted.

Following which, M&As in the sector would not require the approval of the Competition Commission of India (CCI).

Earlier this week, the Cabinet gave its approval for the Banking Laws Amendment Bill, which is likely to be introduced in Parliament during the ongoing Budget session.

Indications are that the Bill may not be passed during the current Parliament session, as the session might be curtailed in view of the upcoming assembly elections in five States.

At the CII event, Mr Mukherjee called for support of the industry to build up political consensus for reforms in the financial sector.

The proposed legislations in the financial sector, including the Banking Laws Amendment Bill, will only be possible after the support of the political parties, he said.

Even in a multi-party democracy, we can build up a consensus on certain important issues. This is where the industry can help out the Government, said Mr Mukherjee.

The RBI had earlier expressed some reservations about the move to put bank M&As under the purview of the CCI.

Earlier on Friday, the Government had notified some key provisions on the Competition Act, giving the CCI the power to vet and approve big mergers and acquisitions in the country.

However, this did not cover the banking sector.