![]() The removal of entry barriers saw the emergence of nine new private sector banks, some of them being the banking arms of the Fl’s themselves. Technology came in to impact the banks in a big way. The artificial divide between the Development Financial Institutions and Banks has been removed. Interest rates were deregulated giving banks more freedom as well as more competition. Entry barriers were introduced in line with the global practices. Winds of change appeared with the onsets of financial sector reforms. The Indian banking sector is inhabited by twenty odd public sector banks, many of which have become grossly inefficient under thirty years of government patronage. And any suggestion of merger of banks would be regarded as nothing short of blasphemy. Now, the paradigm shifts lies in the fact that while the earlier mergers took place at the behest of the government, the market forces drove the merger of HDFC BANK and Times Bank.Īny talk of M&A in the Indian banking sector would have been pointless a few years ago. There is no denying the fact that there have been mergers in the Indian banking sector before, but they were essentially attempts by the government to bailout the weak public sector banks that made the stronger partners feeble. It signaled that Indian banking sector has finally joined the MBA bandwagon. It is the first ever mega merger of Indian banks. In November 1999, when Deepak Parekh and S M Data, Chairman of new private sector banks shook hands, they created a history of sorts.
0 Comments
Leave a Reply. |