With the March-end deadline for the biggest-ever amalgamation scheme is approaching, eight state-owned banks on Thursday announced swap ratios for the proposed mergers.
Punjab National Bank (PNB) in a regulatory filing announced the share exchange ratio in accordance with the scheme of amalgamation, as it is set to merge Oriental Bank of Commerce (OBC) and United Bank of India (UBI) into itself with effect from April 1.
PNB's board in its meeting on Thursday has approved for amalgamation of OBC and UBI, Punjab National Bank said in a BSE filing.
According to the swap ratio, 1,150 equity shares of PNB are to be exchanged for every 1,000 equity shares of Oriental Bank of Commerce, while 121 equity shares of PNB are to be swapped for every 1,000 equity shares of UBI.
A Grievance Redressal Committee headed by Vijay Kumar Vyas, a retired judge of Rajasthan High Court, has been set up to address the grievances of shareholders.
The committee is intended to address those shareholders who either individually or collectively hold at least 1 percent of the equity capital of any of PNB, OBC or UBI; or 100 shareholders acting collectively, of any of PNB, OBC or UBI.
"The board of directors of the bank...have fixed Wednesday, March 25, 2020, as the record date for issuing and allotting equity shares of the PNB to the shareholders of OBC and UBI as per the share exchange ratio," PNB said in the filing.
Meanwhile, Andhra Bank on Thursday also announced the swap ratio for its merger, it said in a filing. Andhra Bank and Corporation Bank are to be amalgamated into Union Bank of India with effect from April 1, 2020.
Andhra Bank said, "Further, the board of directors of the bank at its meeting held on March 5, 2020, has approved the equity share exchange ratio for amalgamation of Andhra Bank into Union Bank of India for 325 equity shares in Union Bank of India for every 1,000 equity shares in Andhra Bank."
Union Bank in a separate exchange filing said its board at its meeting on Thursday has also approved the equity share exchange ratio. It includes 325 equity shares of Union Bank of India for every 1,000 shares in Andhra Bank and 330 shares in Union Bank for every 1,000 equity shares in Corporation Bank.
Also, for Syndicate Bank's merger into Canara Bank, the share swap is 158 equity shares of Canara Bank for every 1,000 equity shares of Syndicate Bank.
The lenders in their respective filings to the exchange said their boards have approved the amalgamation of Syndicate Bank into Canara Bank.
For these two banks, an expert committee (Grievance Redressal Committee ) is to be headed by K N Keshavanarayana, former judge of the High Court of Karnataka, to address the grievances of minority shareholders.
The Union Cabinet on Wednesday had okayed the amalgamation of 10 public sector banks to create four large state-owned lenders with effect from April 1, 2020.
According to the mega consolidation plan, OBC and UBI will merge into PNB; Syndicate Bank into Canara Bank; Andhra Bank and Corporation Bank into Union Bank of India; and Allahabad Bank into Indian Bank.
After the mergers, there will be seven large public sector banks (PSBs) and five smaller ones.
Last year, Dena Bank and Vijaya Bank were merged with Bank of Baroda. Prior to this, the government had merged five associate banks of SBI and Bharatiya Mahila Bank with the State Bank of India.
The anchor bank Punjab National Bank will become the country's second-largest bank, with business size of Rs 17.94 lakh crore, after SBI which has a business of over Rs 52 lakh crore.
Bank of Baroda will become the third-largest bank, followed by Canara Bank, Union Bank of India, Bank of India, and Indian Bank. The other PSBs are Central Bank of India, Indian Overseas Bank, UCO Bank, Bank of Maharashtra, and Punjab and Sind Bank.The stock of PNB on Thursday closed at Rs 44.90 on the BSE, up 1.01 percent from the previous close, while Union Bank of India's shares jumped 8.25 percent to Rs 39.35 apiece. Canara Bank rose marginally by 0.40 percent to close at 139.45 apiece.