Merger of Banks – Disadvantages for Bank Employees as well as public

 As the Government has given its in principle approval for merger of public sector banks, it has become a hot topic of discussion among bankers. The bankers are afraid of the mergers because this is going to affect them. Unions of Bank employees are also opposing the decision of the central government to merge public sector banks to make fewer and better banks 

1> AIBOC Condemns Cabinet Approval of Merger of Public Sector Banks

2> CPI also condemns  the cabinet approval and oppose the bank merger

There will be benefits of merger in few cases  but there will be side effects too. Bankers are concerned about the disadvantages of merger of banks to them.

Let’s understand the disadvantages of merger of public sector banks for the bank employees.

1. After merger of public sector banks, there will be excess workforce, which will lead to VRS and further hiring will be stopped or restricted, which will affect the employment.Even after computerization and present digitization recruitment  process already slow. Previous Year IBPS  last year recruit 15000+ but present  year only 3500+ . 

2> If consolidation  or meger done  minimum 10 years recruitmernt process will be stop. That means  a generation gap occur with unemployment only due to rubbish decisin of MOdi Govt.(Recap   the effect of  with drawn  English subject from primer level in Westbengal Left front GOVT)

3  Positions at top will get reduced as there will be lesser number of CMDs/ EDs and GMs. That means there will be slow and delayed promotions in the bank. Not only CMD/ED or GM  even AGM and chief Manager level also be excess  that means promotion process completely paralised

4. Different Banks have different culture, systems, processes, procedures and merger will lead to clash of organizational cultures. Employees of larger bank does not give equal treatment to employees of smaller bank in the new and merged bank. This may happen in transfers, postings and promotions or in day to day working. This may lead to discontent among staff and unhealthy working environment which will affect the efficiency of workers. Small banks will will lose their local characteristics. Presently SBI associates staff feel the problem after merger with SBI . They are 2nd class citizen in SBI. In upper rang like CM and AGM only promoted from SBI  very few from Associated bank

5. Merger of a weak bank with a strong bank may always not result into a better bank as the weaknesses of one bank may get transferred and the merged entity may become weak. As happened in amalgamation of Global Trust Bank with OBC. Overall profitability may not increase, as envisaged, because losses of the weak bank may eat up the profits of strong bank.Oriental bank only bank in India was with ZERO NPA bank. But after amalgamation of GTB OBC's health deteriorate day to day  now see where they are???

6. AIBOC in its circular stated that Government has broader plans to privatize public sector banks to attract foreign investment citing examples of HDFC, ICICI and Axis Bank.

7>Public also lost their option to choose the bank branch for better service. Few bank will start their monopoly service once again

8>Few public sector bank till today offer good customer service only for competition in market  , after merger no competition    no good service  so general public also suffer.

9>Recovery process also be paralyzed It will  .help the big corporate  borrower who are main culprit.

Above those point so many point are theire for  side effects of merger of public sector banks. Please submit your views in the comment box below. or mail me swapan.bhattacharya02@gmail.com   or whatsapp me in the no 9804271241  your opinion please