Amalgamated entity of 3 PSBs to retain sovereign status: United Bank of India chief

Alleging that some private banks were trying to mislead a section of depositors of the three state-run banks which will be merged into an entity by telling them to shift their deposits, a top UBI official on Saturday said that the proposed amalgamated lender will retain the "sovereign status".

In the biggest consolidation exercise in the banking space, the Centre had announced that the United Bank of India and Oriental Bank of Commerce would be merged with Punjab National Bank, making the proposed entity the second largest public sector bank (PSB).

Speaking to reporters here, United Bank of India MD and CEO Ashok Kr Pradhan said that the "sovereign status of the amalgamated entity will not be diluted as government holdings in these banks are very high".

The merger of the three PSBs is scheduled to come into force from April 1 next year.

"There are some vested interests. Particularly, some private banks have been spreading rumours by posting their agents in front of some branches and telling the depositors to shift their deposits as these (public sector) banks will be closed down", Pradhan alleged.

He also said some groups have been trying to launch a "misinformation campaign to scare the depositors" so that they shift their deposits elsewhere.

"There is no cause for worry and money with our banks is fully safe and secured," he said.

Regarding the progress of the amalgamation process, he said it is "going on smoothly" and 34-odd committees, formed by the three banks, would submit their reports by the end of December.

The amalgamated lender will have a new name and logo and Punjab National Bank will be the anchor bank, he said.