Bank Mergers — Set 3
Banking · बैंक विलय · Questions 21–30 of 50
Effective from 2020, which bank’s customers became customers of the Union Bank of India?
Correct Answer: B. Andhra Bank
Customers of Andhra Bank and Corporation Bank were integrated into Union Bank of India. This was part of the government's plan to reduce the number of PSBs to 12. Union Bank of India became the anchor bank for this specific consolidation.
Which bank was merged with the State Bank of India in 1959, shortly after the SBI Act was passed?
Correct Answer: B. Various Princely State Banks became associates
In 1959, the State Bank of India (Subsidiary Banks) Act was passed, making eight state-owned banks its associates. This was a unique form of structure where they remained separate entities but under SBI control. Over time, these associates were gradually merged into the parent SBI.
Which bank's merger with HDFC Bank in 2023 made it one of the largest financial entities in the world?
Correct Answer: A. HDFC Ltd
HDFC Bank merged with its parent housing finance company, HDFC Ltd, in a massive reverse merger. This created a giant financial services provider with a massive mortgage portfolio. The merger was aimed at leveraging the cross-selling opportunities between banking and housing finance.
Which bank took over the operations of Lakshmi Vilas Bank in 2020 through a rare forced merger with a foreign entity's Indian arm?
Correct Answer: D. DBS Bank India
DBS Bank India, a subsidiary of the Singapore-based DBS, took over Lakshmi Vilas Bank. This was the first time a struggling Indian private bank was merged with a foreign bank's local subsidiary. The RBI initiated this to protect depositors after the bank's financial health deteriorated.
Sangli Bank was merged with which of the following private sector banks in 2007?
Correct Answer: A. ICICI Bank
ICICI Bank merged Sangli Bank into itself to expand its reach in the rural areas of Maharashtra and Karnataka. Sangli Bank was an old private sector bank facing capital adequacy issues. This merger helped in stabilizing the regional banking operations.
Which bank was merged with Bank of Baroda in 1988?
Correct Answer: B. Bareilly Corporation Bank
Bareilly Corporation Bank was merged with Bank of Baroda in 1988. Bank of Baroda has a long history of inorganic growth through acquisitions. These smaller mergers helped it build a strong presence in the North Indian plains.
In 2021, the PMC Bank (Punjab and Maharashtra Co-operative Bank) was approved to be merged with which entity?
Correct Answer: C. Unity Small Finance Bank
Unity Small Finance Bank took over the crisis-hit PMC Bank to resolve its long-standing issues. This was a significant step in resolving the failures in the co-operative banking sector. The merger provided a path for the recovery of depositors' funds over a period of time.
Which committee's report is titled 'The Committee on the Financial System' and discussed bank consolidation?
Correct Answer: B. Narasimham Committee I
The 1991 Narasimham Committee I report is titled 'The Committee on the Financial System'. It laid the roadmap for the first phase of banking reforms in India. It advocated for moving away from a fragmented banking system toward a consolidated one.
Which bank merged the 'Nedungadi Bank' into its operations in 2003?
Correct Answer: A. Canara Bank
Nedungadi Bank, the first private sector bank in Kerala, was merged with Canara Bank. The merger happened after the bank faced severe financial irregularities. Canara Bank was chosen by the RBI to take over the assets and liabilities.
What is the primary benefit of bank mergers for the government in terms of capital?
Correct Answer: C. Lower requirement for repeated recapitalisation
Consolidated and stronger banks are better positioned to raise capital from the markets. This reduces the government's need to use taxpayer money for the recapitalisation of many weak banks. It leads to a more efficient use of public funds in the financial sector.