In order to smoothen India’s banking system, Government of India on Monday announced the merger of three major Public Sector Banks (PSBs) including Bank of Baroda, Vijaya Bank, and Dena Bank.
This decision is a part of government’s effort to create the third largest lender in the country. Finance Minister Arun Jaitley said that this decision will make the banks stronger and substantial. He further added that this decision will strengthen the bank and its ability to provide credit will increase.
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Reflecting on the reason for the merger, Jaitley said that the lending was becoming weak and was affecting the corporate sector investment. The merger will lead to better efficiency of banks and customer services, he added.
Earlier in February last year, the government decided to merge State Bank of India (SBI) with its five secondary banks.