Uday Kotak, CEO of Kotak Mahindra Bank, was positive about major bank mergers anunced by Finance Minister, Nirmala Sitharaman, on Friday. He, however, sounded a te of caution as he said that mergers should be executed well for m to create value. In a tweet on Saturday morning, he wrote:

Four mega-mergers

RE | Indian Industry Weighs In On Mega Bank Mergers Amid GDP Slowdown

Finance Minister, dressing a pressing conference on Friday, anunced four mega-mergers of Public Sector Banks (PSUs).  first consolidation anunced was that of Punjab National Bank (PNB), Oriental Bank of Commerce (OBC) and United Bank (UB), which will be led by PNB. This will result in second-largest PSU Bank after State Bank of India (SBI) and will have 11,437 branches. second merger is of Canara Bank and Syndicate Bank which will be anchored by Canara Bank, making it fourth-largest PSU Bank. third merger is that of Union Bank of India, Andhra Bank and Corporation Bank, anchored by UBI and finally that of Indian Bank and Allahab Bank which will be anchored by Indian Bank. In anuncing mergers, banks that are comparatively bigger and stronger are acquiring ones which are based in a particular location or are comparatively weaker, in a manner so as to enhance synergies. mergers anunced on Friday, along with one anunced in 2018, takes total count of PSU banks from 27 in 2017 to 12. 

Multiple reforms to boost ecomy

RE | Nirmala Sitharaman Removes Enhanced Surcharge On FPIs As Per Demands

In a bid to boost ecomy, Finance Ministry has recently anunced reforms in multiple sectors of ecomy with banking reforms being latest. Last week, Ministry anunced a partial rollback of enhanced super-rich tax on foreign and domestic equity investors. government also anunced exemption for startups from 'angel tax', a pack to dress distress in auto sector and upfront infusion of ₹70,000 crore to public sector banks. tax levied on long term and short term capital gained has been withdrawn. In ar anuncement on Wednesday, government cleared 100% FDI in coal mining and 26% FDI in digital news media.

RE | GDP Growth Falls To 5% For Q1 Even As Govt Anunces Key Measures

RE | Indian Industry weighs in on mega bank mergers amid GDP slowdown