Bank Amalgamation: From May 1, there will be only one Regional Rural Bank (RRB) in all the states of India. Under this proposal, the Finance Ministry has issued a notification for the merger of 15 regional rural banks in 11 states. This merger is the fourth phase of the integration of regional rural banks, after which the number of RRBs in the country will be reduced from 43 to 28. These banks are associated with many government banks including the State Bank of India (SBI), which will further strengthen banking services in rural areas.
According to the notification of the Finance Ministry, its effect will be seen in 11 states of the country, Andhra Pradesh, Uttar Pradesh, West Bengal, Bihar, Gujarat, Jammu and Kashmir, Karnataka, Madhya Pradesh, Maharashtra, Odisha, and Rajasthan. The regional rural banks present in these states will be merged into one entity. In this way, the government will be able to achieve the target of 'one state-one RRB'. The effective date for the merger of these regional rural banks has been fixed as May 1, 2025.
RBI is linked to many government banks-
According to the Ministry of Finance, these RRBs present in various states of the country are linked to many government banks. In this sequence, Chaitanya Godavari Gramin Bank, Andhra Pragati Gramin Bank, Saptagiri Gramin Bank and Andhra Pradesh Gramin Vikas Bank sponsored by Union Bank of India, Canara Bank, Indian Bank and State Bank of India will be merged to form Andhra Pradesh Gramin Bank.
Big merger in UP and Bengal too-
Three Regional Rural Banks (RRBs) in Uttar Pradesh and West Bengal will be merged into a single entity. In Uttar Pradesh, 'Uttar Pradesh Gramin Bank' has been formed by merging Baroda UP Bank, Aryavart Bank, and Prathama UP Gramin Bank, whose headquarters will be in Lucknow with the cooperation of Bank of Baroda. Similarly, 'West Bengal Gramin Bank will be established in West Bengal by merging Bangiya Gramin Vikas Bank, West Bengal Gramin Bank, and Uttarbang Regional Rural Bank.
Impact on other states too-
Apart from this, two RRBs will be merged into one in eight states of the country, Bihar, Gujarat, Jammu and Kashmir, Karnataka, Madhya Pradesh, Maharashtra, Odisha, and Rajasthan. Bihar Gramin Bank will be formed by merging South Bihar Gramin Bank and North Bihar Gramin Bank, whose headquarters will be in Patna. In Gujarat, Gujarat Gramin Bank will be formed by merging Baroda Gujarat Gramin Bank and Saurashtra Gramin Bank.
Each bank will have a capital of Rs 2000 crore-
According to the notification, all regional rural banks will have an authorized capital of Rs 2,000 crore. The government has also infused capital in these regional rural banks before the merger. In the financial year 2021-22, the Center had decided to infuse Rs 5,445 crore in RRBs as its share over two years. In the financial year 2023-24, the performance of RRBs reached historic highs on many parameters. RRB (Reserve Bank of India) recorded a net profit of Rs 7,571 crore that year.
Disclaimer: This content has been sourced and edited from Hr Breaking. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.
