Nirmala Sitharaman announces merger of ten state-run banks to form four large entities

Punjab National Bank, Oriental Bank of Commerce and United Bank of India will now be merged to form India's second-largest public sector bank.

She said following the merger it will have a business of Rs. 17.5 lakh crores.

She said Canara and Syndicate Banks will also be merged to form the country's fourth-largest Public Sector Bank with a business of Rs 15.20 lakh crores.

She announced that the third major merger of banks will involve Union Bank of India, Andhra Bank and Corporation bank.

The Indian Bank will also be combined with Allahabad Bank to create the seventh-largest PSB with the business of R 8.08 lakh crore, the Finance Minister announced.

Sitharaman on Friday said 14 public sector banks are in a profit earning situation in the current financial year.

"In this financial year, 14 public sector banks are in a profit-earning situation out of 18, " she said while addressing a press conference here.

She said, "No retrenchment has taken place post merger of Bank of Baroda, Dena Bank and Vijaya Bank; staff has been redeployed and best practices in each bank have been replicated in others."

"Indian economy is $2.6 trillion of which $1.9 trillion is credit," she said.

SItharaman said the move of consolidating Bank of Baroda, Vijaya Bank and Dena Bank has brought about wide-ranging benefits.

"4 NBFCs have found their liquidity solutions through PSBs since last friday with more in pipeline," she said.

She announced that record levels of loan recovery have been reached.

"Rs 1.21 lakh crores has been recovered," she said.