Union Cabinet approves scheme of amalgamation of Bank of Baroda, Vijaya Bank, Dena Bank

On January 02, the Union Cabinet chaired by Prime Minister Narendra Modi approved the scheme of amalgamation for amalgamating Bank of Baroda (an Indian International banking and financial services company), Vijaya Bank (a public sector bank), and Dena Bank, with Bank of Baroda as the transferee bank and Vijaya Bank and Dena Bank as transferor banks.

The amalgamation will be the first-ever three-way consolidation of banks in India. The merger scheme shall come into force on April 1, 2019.

The merged entity will become the third largest bank in the country, after State Bank of India (SBI) and ICICI Bank.

With regard to the merger, Hon’ble Shri Ravi Shankar Prasad, Minister of Law & Justice and Electronics and Information Technology, Government of India, said, "There will be no impact on the service conditions of the employees and there will be no retrenchment following the merger... The merger has been designed to make BoB as merged entity, a globally competitive lender."

Dena Bank in a press release stated, “Fair Equity Share Exchange Ratio, subject to statutory I regulatory approvals: 110 equity shares of Rs. 2/- each of Bank of Baroda for every 1000 equity shares of Rs.10/- each of Dena Bank."

It added, “A Grievance Redressal Committee headed by Shri Pramod Kade, retired Judge of Mumbai High Court, has been set up to address the grievances of minority shareholders (Minority shareholders are those shareholders who either (a) individually or collectively hold at least 1% (one per cent) of the total paid up equity capital of any of Bank of Baroda, Vijaya Bank or Dena Bank; or (b) are 100 (hundred) shareholders acting collectively, of any of Bank of Baroda, Vijaya Bank or Dena Bank).”