The All India Bank Employees Association (AIBEA) has opposed the Centre’s decision to merge Bank of Baroda, Vijaya Bank and Dena Bank, as it believes such a merger would not be beneficial either to the employees or people at large.
Besides, it would affect the interests of employees, their jobs, job security and employment opportunities in banks, said AIBEA general secretary, C.H. Venkatachalam.
To protest the move, the United Forum of Bank Unions (UFBU), a consortium of nine bank unions, which represent over 10 lakh bank employees and officers in the country, has called for a nation-wide strike on December 26. AIBEA is a constituent of UFBU.
Disagreeing with the government that banks would become stronger through mergers, he cited last year’s merger of six banks with the State Bank of India. “But SBI has not become any bigger. Rather, problems of SBI have become bigger. Branches have been closed. Staff have become surplus. Business expansion has slowed down,” Mr. Venkatachalam said.
Also, he said that after the merger, the non-performing assets (NPA) had further gone up to ₹2.25 lakh.
BOB, Dena Bank and Vijaya Bank have a total NPA of ₹80,000 crore. “Would these bad loans would be automatically recovered if these banks are merged,” he asked. Mr. Venkatachalam said the need of the hour was expansion of the banking industry and not consolidation as the banking density in India was relatively low compared to many countries in the world.
Moreover, mergers will exclude the underprivileged from the banking map. According to him, though the Centre argued that mergers would make banks stronger globally, he said, “Even if all 21 public sector banks are merged into one, the combined capital would be only around $3 billion. We cannot match these global banks in terms of their capital strength. Hence, mergers would not make our banks equal to those global banks.”
“Stop mergers, start recovery of bad loans and don’t divert nation’s attention through mergers,” he said.
