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The proposed merger of three Public Sector Banks (PSBs), Bank of Baroda-Vijaya Bank-Dena Bank, has been challenged in the Delhi High Court. A petition has been filed by the All India Bank Officers’ Confederation and the All India Vijaya Bank Officers’ Association, requesting a hearing on the subject matter.
A bench led by Justice S Raveendra Bhat has issued a notice to the finance ministry, RBI, Bank of Baroda, Dena Bank and Vijaya Bank regarding the proposed amalgamation which is scheduled to be effective from April 1, 2019.
The petition filed to the Delhi High Court alleges the government has abused its power as the majority shareholder and has called the merger as a blatant circumvention and disregard for statutory procedures.
The proposed merger under discussion was approved by the union cabinet on Jan. 2, 2019. Law Minister Ravi Shankar Prasad, while addressing the media, claimed that the merged entity will have more lending power whereas the post-merger entity will have global competitiveness.
However, according to the petitioners, the merger lacked consultations with the RBI and it failed to comply with the Section 9(1) of the Acts as well as Article 14 of the Constitution. The petitioners have also questioned the government as it failed to acknowledge the interests of minority stakeholders including employees and customers.
Bank of Baroda-Vijaya Bank-Dena Bank Challenged In High Court
