There is buzz about Dena Bank and Canara Bank merger but there is no official version available. If it happens, it may well be some thing to be happy about. I have earlier on expressed the opinion that there is need to consolidate all the nationalised banks in four with regional head-quarters. This should be no problem for there is no particular contentious issue that may arise about fairness of valuations etc. If any special need is felt, State Bank of India may still be kept as separate because it already has pan-Indian presence.
Such consolidated banks may become banks of world size as the Indian economy grows. Also there will be lot of cost saving in operations and client servicing. There would be pressure on groups who have defaulted here and borrowed there, to be more particular about settling the accounts. There will be less of pressure on centralised cheque clearing system. The IT related expenses will be more manageable and the solutions would be more fit than it is now for each of the banks separately.
If this is done at some speed after a comprehensive study by some govt constituted team and under an act of parliament, it would be that much better. If there will be excuses, those will be lame excuses as when Mrs Indira Gandhi had nationalised no preparation was done although the banks had very differing characters. Compared to that this would be much simpler thing to do and with greater benefit. Let us see if the govt under control of Indira's daughter-in-law and headed by a one time chief banker to the nation and an economist, does act promptly.
Hari Om,
Krsna Khandelwal
BIRDINFO Stock Rx - A prescription for stock market
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