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Finmin notifies merger of 3 Orissa rural banks

The Union finance ministry has notified the merger of three Orissa-based Regional Rural Banks Kalinga Gramya Bank, Nilachal Gramya Bank and Baitarini Gramya Bank ? to create a new RRB, Gramya Bank.

The Union finance ministry has notified the merger of three Orissa-based Regional Rural Banks (RRBs) ? Kalinga Gramya Bank, Nilachal Gramya Bank and Baitarini Gramya Bank ? to create a new RRB, Gramya Bank. The new bank will be based in Bhubaneswar.

After the merger, the bank will have 8,000 employees and and is expected to do a business of Rs 10,000 crore per annum.

The new bank will be sponsored by Indian Overseas Bank. Prior to the merger, Kalinga Gramya Bank was sponsored by UCO Bank, Nilachala Gramya Bank was sponsored by Indian Overseas Bank and Baitarani Bank was sponsored by Bank of India.

The merger was delayed due to opposition from Nilachala Gramya Bank Officers? Association. As the Nilachal Gramya Bank was a profit-making bank, the Association was opposing its merger with two loss-making banks. The matter went to the Orissa High Court.

Even though a decision on merger was taken by top officials of the Union finance minister Reserve Bank of India and Nabard at a meeting on December 15, the merger was held up as the Nilachala Bank Officers? Association opposed to the choice of UCO Bank as the sponsored bank.

Finally, the stalemate came to an end after Indian Overseas Bank was nominated as the sponsored bank as per the demand of the Association.

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First published on: 12-01-2013 at 01:08 IST
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