Dena Bank-Vijaya Bank-Bank Of Baroda Merger: Here’s What Will Or Will Not Change For Customers After Amalgamation
Bank of Baroda-Dena Bank-Vijaya Bank merger: Amalgamation to create second largest PSB; here is how things will change for customers
India’s two state-run banks Dena Bank and Vijaya Bank will be merged with Bank of Baroda from 1 April 2019. People are confused about what will happen after Dena Bank-Vijaya Bank-Bank of Baroda’s amalgamation and what could change? In this article, we will be talking about everything from accounts, passbook, debit cards, credit cards and password as the merger will lead some changes for their customers of both the banks.
According to reports, the government of India has decided to infuse Rs 5,042 crore into state-owned Bank of Baroda (BoB) ahead of amalgamation of two other public sector lenders Dena Bank and Vijaya Bank with BoB. If reports are anything to go, the Scheme of Amalgamation, shareholders of Vijaya Bank will get 402 equity shares of BoB for every 1,000 shares held. Talking about Dena Bank, its shareholders will have 110 shares for every 1,000 shares of BoB.
It is to be noted that the announcement of amalgamation of Vijaya Bank and Dena Bank and Bank of Baroda was made in September last year in order to create the third largest lender after SBI and ICICI Bank. Following their mergers, the details of every customer of Dena and Vijaya Bank might be changed. The customer may get new passbooks, cheque books, debit and credit cards, and even new account numbers and customer IDs. If these changes are made, then customers will have to get their banking details updated with entities like the Income Tax Department, mutual funds, insurance companies, etc.
Here’s is how the amalgamation of BoB, Vijayaa and Dena Bank might affect their customers.
Looking at Some aspects, like the interest rate on fixed deposits or recurring deposits, and existing loans, are not expected to change.
After BoB-Dena Vijaya Merger, What could change
- Following the merger, new bank account numbers and customer IDs could be provided to the customers.
- Customers will have to update their banking details with entities like the Income Tax Department, mutual funds, insurance companies, National Pension Scheme, etc, to incorporate the new account numbers and IFSC codes.
- Customers might need to fill new instruction forms for SIP and loan EMIs.
- New cheque books, passbooks, credit cards and debit cards might be issued.
- Some branches might be closed after consolidation. Customers of such branches are likely to be transferred to a different branch of Bank of Baroda.
After Merger What Would Not Change?
- The interest rates for personal loans, home loans, auto loan, education loan, etc are not likely to change.
- The interest paid to customers on fixed deposits or recurring deposits is expected to remain unchanged.
In 2018, Finance Minister Arun Jaitley said that the amalgamation of these three banks would make them stronger and sustainable as well as increase their lending ability.
The government had said that the merger of Bank of Baroda, Dena Bank and Vijaya Bank will help create a strong globally competitive bank with economies of scale and enable the realisation of wide-ranging synergies.