The merger of the two Kerala-based private sector banks, Federal Bank and Catholic Syrian Bank (CSB), has now entered the final lap.
Although the CSB’s board did not take any decision on the merger at a meeting held On Monday, sources at the bank said that the merger is likely to take shape after the Parliamentary polls are over.
“The board meeting did not discuss the item, but a vast majority of the members are in favour of this (the merger),” said a source.
He added that the decks were cleared for a merger after the protests of the Thrissur Archdiocese of the Catholic Church had been assuaged to a very large extent.
The church had been opposing the move, saying that the regional identity of the bank would be lost due to the proposed merger.
In particular, the Archbishop of the Thrissur Archdiocese Mar Andrews Thazhath had vehemently opposed the merger. All the political parties had also supported the church’s views as it has a big hold among the electorates of the central districts of Kerala.
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“But both the entities’ opposition weakened after it was pointed out that the Federal Bank is also a Kerala-based bank,” said an official.
Earlier, the Catholic Church even mooted a proposal to purchase the shares owned by Surachan Chansri Chawla, a Bangkok-based Indian businessman who holds a 23 per cent stake in CSB, in order to have more say in the bank.
But the church was not in a position to raise the huge amounts of money required to purchase the shares. So, according to sources, it is now almost certain that the merger of the two banks will become a reality in the near future. “You will have to wait till after the polls to get a clear picture as the new ruling front at the Center will have to give its consent for the merger to be a smooth process,” said a source.
Meanwhile, it has been reliably learnt that the Federal Bank has decided to proceed with the merger as this would be beneficial for the growth of the bank.
The bank had earlier taken over Ganesh Bank of Kurundwad and is now considered to be one of the top old-generation private sector banks of the country.