Merger with Bank of Baroda and Dena Bank is a great opportunity not only for the customers, but also for staff members, said RA Sankara Narayanan, managing director and CEO of Vijaya Bank.
The government on Monday proposed to merge Bank of Baroda (BoB), Vijaya Bank and Dena Bank.
“Vijaya Bank is 89-years old bank and doing pretty well in today’s market conditions both, in growth and profit. The merger or amalgamation of two strong banks and the third bank also will lead to a bigger sized bank. That is a great opportunity for not only the customers but also for the staff members," said Narayanan.
Talking about the benefits on merger in specifics, Narayanan said, "That adds definite value to the banking operations in India- that is number one. Number two- global presence. We don’t have any foreign branches, BoB does and that definitely will assist our customers to get foreign currency loans under the benefits. Number three- the combined entity has a business of around Rs 15 lakh crore which will be a strong base which will give a wide range of production services to customers."
On NPA front, he said, “The Dena Bank’s NPA is around 11 percent, BoB’s NPA is somewhere around 5.5 percent and our bank’s NPA is around 4.1 percent. The combined entity will have around 5.3-5.7 percent . So definitely the total NPA in absolute numbers is somewhere around Rs 80,000 crore for an asset size of Rs 8 lakh crore."
“HR will be beneficial on two fronts, one is a bigger entity gives more opportunities for growth and promotion, career prospects and number two- the retirements. Up to 2020, a lot of people are retiring, that will give youngsters a better chance to grow in the organisation and the absorption of current manpower is not an issue at all,” added Narayanan.
The MD further said that he would be now approaching board for its approval.