I have seen a merger taking place at the Bank where I worked.
But not from the table in which the documents were exchanged. But sitting at a local controlling office down south and watching a Delhi based bank merging with a Karnataka based Bank.
That was a merger of Lakshmi Commercial Bank with Canara Bank. The effects were not fully felt at my level. Just a level above, the staff felt it. The transfer to the earlier LCB branches with a different culture and working procedures was the top problem. But the make-up was very quick and entire process went on very smooth. It was all perhaps because of the strong base of the bigger bank; the values the bank had and the policies they followed scrupulously.
Today when the finance minister spoke about the mergers, it just triggered off my memories. The scenario has not changed. But yes, the views have changed.
“However, he was of view that the initiative for consolidation have to come from the management of the banks themselves with the Government playing a supportive role as the common shareholder.”
It means a lot – the intention of the bank initiating the merger should also be to protect the interest of the smaller bank’s clients (both depositors and the debtors). What should not be forgotten is that consolidation is the key to make the business flourish.
IMP. NOTE : This blog was started on Sep.17, 2005. The above post is typed and inserted into this blog from my diary entry of the same date as the date of posting.
Posted by Revathi 