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The mood at the corporate headquarters of ING Vysya Bank in Bengaluru was a little sombre on Friday as the news of the bank's acquisition by Kotak Mahindra Bank spread. The worried employees were seen discussing the pros and cons of the merger and the future of their employment in the merged entity.
Employees in smaller groups were seen talking about the development and some were exchanging the information they were privy to, with others. Many employees said they were worried if their jobs might become redundant after the merger.
A cross-section of the employees told Business Standard that overall, the merger sounded positive as they would now become a part of a larger banking entity. However, there could be duplication of some positions such as zonal managers, regional managers and sales heads. Those holding such positions might lose their jobs or get transferred.
ING Vysya Bank has 10,591 employees, while Kotak Mahindra has 29,220. Welcoming the deal with Kotak Mahindra Bank, an employee said his job might be at risk because he is not working in a branch.
“I have never seen such a depressed mood among the employees in this office in the past,” said another employee of ING Vysya outside the corporate head office.
However, many others felt excited that they will now be part of the fourth-largest private bank in the country. “I am excited to be part of a fourth largest private bank in the country. I am sure, there will be lot of growth opportunities for ING Vysya employees across Kotak Group. We will be part of a larger and deeper pan India bank,” said Prateek Tiwari, Branch Head of ING Vysya Bank’s Vittal Mallya Road branch.
According to him, the merger will provide ING Vysya employees new challenges because Kotak Mahindra Bank has a presence in segments such as online trading and larger insurance play, among others. At the same time, he feels Kotak Mahindra would benefit from the larger international client base. It will also benefit from ING’s digital and mobile banking platforms.
ING Vysya’s diverse segments with more than two million customers, will now have access to Kotak’s wide product suite across financial services, he added.
“With 1,214 branches and 1,794 ATMs in the merged entity, we will give tough competition to other private banks. Our aim will be to achieve 15 per cent return on investment by end of FY16,” said another employee.
At the same time, customers of ING Vysya Bank have wholeheartedly welcomed the merger saying it does not make much difference to them because all banks are equally regulated by the Reserve Bank of India.
“I am happy with the merger. Both ING Vysya and Kotak Mahindra are good banks. There is no worry for me as they both are regulated by the RBI,” said Shankar, an employee of Café Coffee Day, who holds an account with ING Vysya Bank.
Ramesh R K, another ING Vysya Bank customer, said, “I am very happy to hold an account here. This is the best bank in terms of offering high security and provides good service through its products. I don’t know how Kotak Mahindra Bank functions and hope my experience with them will be the same.”
In contrast, employees at the regional office of ING Vysya Bank' in Hyderabad were not surprised by the development as they had been anticipating the merger for a long time.
"We were all aware that something of this sort was coming. The proposal to merge with some private bank was in the offing for the last 18 months,” a senior official at the regional office told Business Standard.
The regional office at Himayatnagar monitors the operations of ING Vysya's 180-strong branch network and supervises the entire workforce in both states.
On jobs, a senior bank official said: “We are all waiting to see what sort of arrangement is being worked out. Any merger will take at least two years to complete. So it's a wait-and-watch approach for us.”
According to women employees at the consumer loans branch, job security is a prime concern for them. They added that they were expecting “clarity from the CEO-designate very soon”.
Employees at the Ameerpet branch in Hyderabad, too, expressed similar concerns. “The banks have enough time to work on the process. And we hope our doubts will be cleared soon,” said an employee.
Even as the merger news is keeping the existing staff occupied, the regional office is in a hiring mode and is currently undertaking job interviews for the position of sales and marketing executives.
