The merger of public sector lender Punjab National Bank (PNB) with United Bank of India (UBI) and Oriental Bank of Commerce (OBC) will not result in any layoffs, news agency ANI reported.
PNB MD & CEO Mallikarjuna Rao said: “There will be no retrenchment of employees due to the merger of Oriental Bank of Commerce, Union Bank of India with Punjab National Bank.”
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PNB employs as many as 103,000 people and the bank is expecting further growth in employee strength due to the merger, the report added.
Rao added: “PNB has the strength of 103,000 employees and, as the business grows, our employee strength will also grow.”
The merger of these state-backed lenders is expected to create the second-largest public sector bank in the country in terms of business and branch network.
The merged entity will have INR18trn ($242.51bn) in loans and deposits combined and will be 1.5 times the size of PNB’s current business.
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By GlobalDataThe merger will also create the second-largest branch network in the country.
The synergy brought about by the merger is expected to create a competitive bank, PNB 2.0, the bank said.
PNB added that all the customers, including depositors, of UBI and OBC, will be treated as PNB customers, as a result of the amalgamation.
The amalgamation plan was first announced by Indian finance minister Nirmala Sitharaman in September last year.
The plan included the consolidation of 10 state-run lenders into four bigger banks.
The amalgamation of UBI and OBC with PNB has been effective since April 2020.
Recently, PNB decided to offer a one-time loan restructuring to its corporate and retail customers impacted by the Covid-19 pandemic.
The move comes after RBI allowed banks to execute a one-time restructuring of corporate and personal loans for accounts facing stress due to the current crisis.
