The merger of Bank of Baroda, Dena Bank, and Vijaya Bank will result in the most important merger in the banking sector for 2019. The decision was already made by the government earlier in 2018 to merge the three banks. Now, the two major state-run banks, Dena Bank and Vijaya Bank, will function as Bank of Baroda from 1st April 2019. The transfer of banking operations and accounts held by these to banks will be held post-merger.

The three banks have a combined loan of Rs. 6.40 lakh crore and a total deposit of Rs. 8.41 lakh crore. This leads to them making the bank the third largest Indian bank, by virtue of assets and businesses.
The changes that might occur

Since the Course of operations is now in the hands of Bank of Baroda, the stakeholders, customers, and employees of Dena Bank and Vijaya Bank may have to face some changes.

A. Changes for Customers

1. The customers could be assigned new bank account numbers and customer Ids.
2. The banking details will have to be updated by the customers with entities like the Income Tax Department, Mutual Funds, Insurance companies, National Pension Scheme, etc.
3. New instruction forms for SIP and loan EMIs might have to be filled by the customers.
4. The customers may be issued new cheque books, passbooks, credit cards, and debit cards.
5. As a result of consolidation, some branches might close and the customers of these branches may be transferred to different branches of Bank of Baroda.

B. Changes for the employees

With the merger, the branches of Bank of Baroda will increase to a total of 9489, which is a good sign in terms of increasing credits, but managing the human resource will be a big challenge.

There will be branches of the two banks that could be overlapping with the branches of Bank of Baroda. So, as a result, they may cut branches that are near to each other and employees of these branches are likely to be transferred to a different branch.

C. Changes for Stake Holders

The shareholders of Vijaya Bank will get 402 equity shares of Bank of Baroda for every 1000 shares held and the shareholders of Dena Bank will get 110 for the same, according to the Scheme of Amalgamation.

Things that are not likely to change

1. The interest rates for loans like an educational loan, personal loan, home loan, and auto loan are not likely to change.
2. The fixed deposit and recurring deposit interest rates are expected to remain unchanged.

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As its investment, the government has decided to infuse Rs. 5042 crore into Bank of Baroda by way of preferential allotment of equity shares of the bank during FY2018-19. The petitions by several bank associations to stay the merger of Bank of Baroda, Vijaya Bank, and Dena Bank were dismissed by the Supreme Court which provided clearance to the way for the Amalgamation.