PSU banks announce swap ratios for proposed merger

The Union Cabinet on 4 March 2020 approved the consolidation of ten public sector banks (PSBs) into four big banks and the merger will take effect from 1 April 2020.

Eight public sector banks on Thursday (5 March) announced the share-swap ratios for their proposed mergers.

Punjab National Bank (PNB) said its board reached consensus on the share-exchange ratio after a meeting on Thursday. According to the swap ratio, 1,150 equity shares of PNB are to be exchanged for every 1,000 equity shares of Oriental Bank of Commerce (OBC), while 121 equity shares of PNB are to be swapped for every 1,000 equity shares of United Bank of India (UBI). The merged entity will be 2nd largest PSU bank in India. The three banks have set 25 March 2020 as the record date for share allotment.

Shares of OBC rose 2.76% to Rs 48.35, PNB fell 5.79% to Rs 42.30 and those of UBI tumbled 19.92% to Rs 5.99.

Meanwhile, for Syndicate Bank's merger with Canara Bank, the share swap is 158 equity shares of Canara Bank for every 1,000 equity shares of Syndicate Bank. The merged entity will be 4th largest PSU bank in India.

Syndicate Bank shares lost 3.33% to Rs 20.30 while those of Canara Bank lost 6.45% to Rs 130.45.

For the amalgamation of Andhra Bank and Corporation Bank into Union Bank of India, share swap ratio stands at 325 shares of Union Bank for every 1,000 shares of Andhra Bank and 330 shares of Union Bank of India for every 1,000 shares of Corporation Bank. The merged entity will be 5th largest PSU bank in India.

Shares of Andhra Bank slumped 8.06% to Rs 12.43, those of Corporation Bank crashed 19.95% to Rs 15.25 and those of Union Bank of India fell 6.73% to Rs 36.70.

Further, Allahabad Bank on Thursday said its board of directors has approved the swap ratio for the its amalgamation into Indian Bank. For every 1,000 equity shares of Allahabad Bank, investors will get 115 equity shares of Indian Bank. The merged entity will be 7th largest PSU bank in India.

Allahabad Bank shares lost 17.21% to Rs 10.73 while those of Indian Bank slipped 3.33% to Rs 69.60.

Powered by Capital Market - Live News