Strike call by union this month to protest against merger of PSU banks

Days after bank unions called off a three-day bank strike from March 11, two unions called for another bank strike on March 27 to oppose the mega merger of PSU banks. Finance Minister Nirmala Sitharaman announced yesterday that the Union Cabinet has approved the plan to merge 10 PSU banks into four larger banks. The merger comes into effect from April 1 this year.

The All India Bank Employees' Association (AIBEA) and All India Bank Officers Association (AIBOA) have given a joint call for an all-India bank strike on March 27. Their demands include stopping the proposed merger of 10 PSU banks, stopping the privatisation of IDBI Bank and rollback of banking reforms, recovery of bad loans and increase of interest rate on deposits.

C.H. Venkatachalam, general secretary, AIBEA, said, the unions have planned series of protests this month peaking with the strike on March 27. The Bank Employees Federation of India (BEFI) has also announced a fortnight-long agitation programme to protest against the merger."Banks themselves face problems due to huge pile of bad loans. While the public sector banks made a total gross profit of Rs.150,000 crore for the year ended March 31, 2019, because of total provisions towards bad loans, etc. amounting to Rs.216,000 crore, the banks ended in a net loss of Rs.66,000 crore," Venkatachalam said.

Sitharaman, on the other hand, said the merger plan would enhance customer convenience, better branch service, higher credit flow, and lesser time in loan sanctions. Greater scale and synergy through consolidation would lead to cost benefits which should enable the PSBs enhance their competitiveness and positively impact the Indian banking system, a Finance Ministry statement said.

As per the amalgamation plan, United Bank of India and Oriental Bank of Commerce would be merged with Punjab National Bank, making the proposed entity the second largest public sector bank. It was decided to merge Syndicate Bank with Canara Bank, while Allahabad Bank with Indian Bank. Similarly, Andhra Bank and Corporation Bank are to be consolidated with Union Bank of India.