Public sector banks to soon reduce to 12 in number
The Central Government plans on a consolidation agenda to create 3-4 global sized banks and reduce the Public Sector Banks to 12. Some region centric banks like Punjab and Sind Bank and Andhra Bank will continue as independent entities, while some mid-size lenders would also coexist. Currently there are 121 PSBs functioning.
Post success of SBI merger, the Ministry of Finance is considering clearing another proposal if the bad loan scenario is improved. Mr. Jaitley recently mentioned the government is “actively working” towards consolidation of public sector banks but declined to provide details, saying this was price-sensitive information.