The Union cabinet on Wednesday approved the first-ever three-way merger in Indian Banking with amalgamation of Vijaya Bank, Dena Bank and Bank of Baroda.Â With the merger, BoB will become the third largest bank after State Bank of India and ICICI Bank."There will be no impact on the service conditions of the employees and there will be no retrenchment following the merger," Union Law Minister Ravi Shankar Prasad told reporters about decisions taken by the Union Cabinet. The merger has been designed to make BoB as merged entity, a globally competitive lender, Prasad added.Â
Cabinet approves first-ever three way merger in Indian Banking with amalgamation of Vijaya Bank, Dena Bank and Bank of Baroda.â€” ANI (@ANI) January 2, 2019
Bank of Baroda (BoB), meanwhile, finalised the share swap ratio for merger of Vijaya Bank and Dena Bank with itself. As per the Scheme of Amalgamation, shareholders of Vijaya Bank will get 402 equity shares of BoB for every 1,000 shares held. In case of Dena Bank, its shareholders will get 110 shares for every 1,000 shares of BoB.
The government in September last year had announced merger of state-owned Vijaya Bank and Dena Bank, with larger peer Bank of Baroda, aiming to create the third largest lender after SBI and ICICI Bank.
On Wednesday, BoB shares fell 3.16% to â‚¹119.40 apiece on the BSE while those of Vijaya Bank and Dena Bank closed flat at â‚¹51.50 and â‚¹17.95, respectively. The benchmark Sensex ended the day 1% lower at 35,891.52 points.
(With PTI inputs)