5 Concerns Around PSB Mergers

1. Are mergers driven by synergies — in products, costs, business, geographies or technology and the most important, cost synergies?
2. Public sector banks are over-staffed. Will they realise cost synergies through branch and staff rationalisation?
3. Narasimham Committee in the late 1990s recommended shutting down weaker banks. Is that ever going to happen, or we just going to saddle strong banks with weaker banks?
4. Will there be adequate reforms in governance and management of these banks? Key reforms to be made are at the board level, including in appointments, especially of government nominees.
5. Will the government be able to manage the fallout of unleashing four mergers simultaneously which is bound to cause upheaval in the industry?