The Hindu : Business : IBA meeting on banks' merger

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Tuesday, Sep 14, 2004

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IBA meeting on banks' merger

KOLKATA, SEPT. 13. The Indian Banks' Association will meet on Friday to chalk out legal nitty-gritty with regard to consolidation in the banking industry.

"Consolidation and mergers in the industry are imminent. It cannot be avoided in the current circumstances, but I cannot say when will it happen,'' the Chairman and Managing Director of Indian Overseas Bank, S. C. Gupta, who is also member of the IBA's Consolidation and Merger Committee, told reporters here today.

Mr. Gupta said the meeting on Friday would discuss certain legal issues to facilitate smooth mergers and acquisitions.

Commenting on the recent RBI directive for restricting maximum holding in private banks by promoters and other entities, he said IOB held 30 per cent stake in Bharat Overseas Bank along with six other banks.

"We have not yet decided to reduce our holding as per RBI directive. We are taking a view and after that we will talk to RBI,'' he said. Mr. Gupta said if they found that IOB would have to bring down its holding to below 10 per cent, then they would think of appointing merchant banker to divest its stake in Bharat Overseas Bank. — PTI

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