The Hindu : National : CPI opposes bank merger proposal

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CPI opposes bank merger proposal

Special Correspondent

NEW DELHI: The Communist Party of India (CPI) has opposed the proposed merger of associate banks with the State Bank of India (SBI), warning of negative consequences and opposition from the unions.

In a letter to Prime Minister Manmohan Singh, CPI national secretary and Rajya Sabha member D. Raja said any such proposal needed consultation with all the stakeholders and should not be hurried up.

While there could be no objection to the SBI increasing its business, profitability and efficiency, it was unwise to merge associate banks with it in order to make it a bigger bank. There was no certainty that by such mergers, the SBI would become more efficient and competitive, the letter said.

Already, four strikes had been held to oppose the move. The United Forum of Bank Unions had given a call for a two-day strike on February 25 and 26.

Geographic evolution

Mr. Raja said the performance of the associate banks was better than that of the SBI in many parameters. They had a historic and geographical evolution and were catering to the development of the States, such as the State Bank of Travancore in Kerala, the State Bank of Mysore in Karnataka, the State Bank of Hyderabad in Andhra Pradesh, the State Bank of Bikaner and Jaipur in Rajasthan, and the State Bank of Indore in Madhya Pradesh and Chhattisgarh.

In order to make the employees accept the merger proposal, the SBI was proposing to extend three retirement benefits while all along bank managements had been complaining about the lack of adequate funds even to provide two. These unfair approaches would have an adverse impact, Mr. Raja said.

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