Earlier the bank unions in India called off their 3 days bank strike which was scheduled from 11th March and now two unions have called for another bank strike on the 27th March 2020 in protest against the merger of PSU (Public Sector Undertaking) banks.
Yesterday, Nirmala Sitharaman, Union Finance Minister announced that the Union Cabinet has approved the merger of 10 PSU banks into 4 larger banks which will come into effect on the 1st April 2020.
The two bank unions – AIBEA (All India Bank Employees’ Association), and AIBOA (All India Bank Officers Association) – gave a joint call for a pan India level strike on the 27th March this year. They demand a stop on the merger of the 10 PSUs along with stooping the privatisation of IDBI bank and rollback of banking reforms, an increase of interest rate on the deposits and recovery of bad loans.
AIBEA’s General Secretary, C H Venkatachalam said that the unions have planned many protests to be carried out in the month of March, peaking with strike on the 27th.
Additionally, BEFI (Bank Employees Federation of India) also announced a 15 days long agitation programme for protesting against the mergers.
Mr Venkatachalam said, “Banks themselves face problems due to huge pile of bad loans. While the public sector banks made a total gross profit of ₹150,000 crore for the year ended March 31, 2019, because of total provisions towards bad loans, etc. amounting to ₹216,000 crore, the banks ended in a net loss of ₹66,000 crore,”.
On the other hand, Ms Sitharaman said that the merger of the PSU banks will aid in customer convenience, higher credit flow, enhanced branch service and decrease the time it takes to sanction a loan. She added that the merger will also help to increase the scale and synergy via consolidating which will lead to cost benefits that should enable the PSBs (Public Sector Banks) in enhancing the competitiveness and will have a positive impact on the Indian Banking System.
As per the merger plans, the United Bank of India and the Oriental Bank of Commerce would be merged with the Punjab National Bank which will make it the 2nd biggest PSB.
Also as per reports, the Syndicate Bank will be merged with Canara Bank, and Allahabad Bank will be merged with Indian Bank. Corporation Bank and Andhra Bank will be merged with the Union Bank of India.