India’s banking sector has undergone significant transformation through a series of mergers aimed at creating stronger and more efficient financial institutions. Over the years, the Government of India has consolidated several public sector banks (PSBs) to improve their financial health, enhance customer service, and build globally competitive banks. These mergers have reduced the number of public sector banks from 27 to 12, making India’s banking system more robust and technologically advanced.
For aspirants preparing for IBPS PO, IBPS Clerk, SBI PO, SBI Clerk, RBI, NABARD, SSC, UPSC, Insurance, and other Government Exams, questions related to bank mergers are frequently asked in the Banking & Financial Awareness section. This article provides the latest bank merger news, a complete merger list from 1993 to 2026, merger timeline, customer impact, and other important details.
Bank Merger News 2026
Reports regarding another round of public sector bank consolidation, popularly known as PSU Bank Merger 2.0, have attracted considerable attention. While several media reports suggested that smaller public sector banks could be merged with larger banks, the Government of India has clarified that no formal proposal for fresh PSU bank mergers is currently under consideration. Candidates should rely only on official notifications for examination purposes.
Latest Updates
- India currently has 12 Public Sector Banks (PSBs).
- Media reports have speculated about another round of PSU bank consolidation.
- The Government has clarified that no official proposal has been approved.
- Finance Minister Nirmala Sitharaman has stated that bank consolidation remains a long-term policy discussion.
- Any future mergers will be announced officially by the Ministry of Finance.
Note: Reports suggesting that the number of PSBs will reduce from 12 to 4 remain speculative unless officially announced.
Complete Bank Merger List in India (1993–2026)
India has witnessed several mergers involving public sector banks, private sector banks, foreign banks, and local area banks over the last three decades. The following table provides the complete year-wise list of major bank mergers in India.
| Acquiring Bank | Acquired Bank(s) | Year |
| Punjab National Bank | New Bank of India | 1993 |
| Bank of India | Bank of Karad Ltd. | 1995 |
| State Bank of India | Kashinath State Bank | 1996 |
| Oriental Bank of Commerce | Punjab Cooperative Bank | 1997 |
| Oriental Bank of Commerce | Bari Doab Bank | 1999 |
| Union Bank of India | Sikkim Bank | 1999 |
| Bank of Baroda | Bareilly Corporation Bank | 1999 |
| HDFC Bank | Times Bank | 2000 |
| ICICI Bank | Bank of Madura | 2001 |
| ICICI Bank | ICICI Ltd. (Reverse Merger) | 2002 |
| Bank of Baroda | Banaras State Bank | 2002 |
| Punjab National Bank | Nedungadi Bank | 2003 |
| Oriental Bank of Commerce | Global Trust Bank | 2004 |
| Bank of Baroda | South Gujarat Local Area Bank | 2004 |
| Bank of Punjab | Centurion Bank | 2005 |
| IDBI Bank | United Western Bank | 2006 |
| Centurion Bank of Punjab | Lord Krishna Bank | 2006 |
| Indian Overseas Bank | Bharat Overseas Bank | 2007 |
| ICICI Bank | Sangli Bank | 2007 |
| HDFC Bank | Centurion Bank of Punjab | 2008 |
| ICICI Bank | Bank of Rajasthan | 2010 |
| Kotak Mahindra Bank | ING Vysya Bank | 2014 |
| State Bank of India | SBBJ, SBH, SBM, SBP, SBT & Bharatiya Mahila Bank | 2017 |
| IDFC Bank | Capital First (IDFC FIRST Bank) | 2018 |
| Bank of Baroda | Dena Bank & Vijaya Bank | Effective: 1 April 2019 |
| Punjab National Bank | Oriental Bank of Commerce & United Bank of India | Announced: 2019Effective: 1 April 2020 |
| Canara Bank | Syndicate Bank | Announced: 2019Effective: 1 April 2020 |
| Union Bank of India | Andhra Bank & Corporation Bank | Announced: 2019Effective: 1 April 2020 |
| Indian Bank | Allahabad Bank | Announced: 2019Effective: 1 April 2020 |
| DBS Bank India | Lakshmi Vilas Bank | 2020 |
| HDFC Ltd. | HDFC Bank | Effective: 1 July 2023 |
Major Public Sector Bank Mergers
The biggest transformation in India’s banking sector took place between 2017 and 2020, when the Government merged multiple public sector banks to create larger and stronger institutions. These mergers improved operational efficiency, expanded branch networks, and enhanced the banks’ lending capacity.
SBI Merger (2017)
On 1 April 2017, the State Bank of India merged its five associate banks and Bharatiya Mahila Bank into a single entity. This became India’s largest banking merger and significantly strengthened SBI’s position among the world’s leading banks. Banks Merged with SBI
- State Bank of Bikaner and Jaipur (SBBJ)
- State Bank of Hyderabad (SBH)
- State Bank of Mysore (SBM)
- State Bank of Patiala (SBP)
- State Bank of Travancore (SBT)
- Bharatiya Mahila Bank (BMB)
Bank of Baroda Merger (2019)
On 1 April 2019, Dena Bank and Vijaya Bank were merged with Bank of Baroda. This was India’s first three-way merger of public sector banks and created the country’s third-largest PSU bank by assets.
- First three-way PSU bank merger
- Created the third-largest PSU bank
- Improved operational efficiency
- Expanded customer base
- Strengthened capital position
Mega PSU Bank Mergers (2020)
The government announced the merger of ten public sector banks into four anchor banks in August 2019, and the mergers became effective on 1 April 2020. This reduced the total number of public sector banks from 18 to 12, making the banking system stronger and more efficient.
| Anchor Bank | Merged Bank(s) | Major Outcomes |
| Punjab National Bank (PNB) | Oriental Bank of CommerceUnited Bank of India | • Became India’s second-largest PSU bank by branch network.• Expanded lending capacity.• Improved geographical reach. |
| Canara Bank | Syndicate Bank | • Became the fourth-largest public sector bank.• Expanded branch network.• Strengthened retail and agricultural banking. |
| Union Bank of India | Andhra BankCorporation Bank | • Improved presence across southern and western India.• Enhanced MSME and retail lending.• Increased operational efficiency. |
| Indian Bank | Allahabad Bank | • Strengthened pan-India presence.• Improved capital adequacy.• Enhanced financial stability. |
Recent Private Sector Bank Mergers in India
Apart from public sector bank consolidation, India has also witnessed several major mergers in the private banking sector. These mergers were primarily aimed at expanding customer reach, strengthening retail banking, improving digital capabilities, and increasing market share. Some of these mergers significantly reshaped India’s private banking landscape.
HDFC Ltd. Merged with HDFC Bank (2023)
On 1 July 2023, Housing Development Finance Corporation (HDFC) Ltd. merged with HDFC Bank, creating one of the world’s largest financial institutions by market capitalization. The merger integrated housing finance with banking services under a single entity.
- Effective Date: 1 July 2023
- Merged Entity: HDFC Ltd. + HDFC Bank
- Created one of India’s largest private sector banks
- Improved housing loan and retail banking integration
- Enhanced digital banking and financial product offerings
DBS Bank India Merged with Lakshmi Vilas Bank (2020)
In November 2020, the RBI approved the amalgamation of Lakshmi Vilas Bank with DBS Bank India to safeguard depositors’ interests. The merger helped stabilize the financially stressed Lakshmi Vilas Bank while expanding DBS Bank’s presence in India.
- Effective Date: 27 November 2020
- Protected depositors and ensured uninterrupted banking services
- Expanded DBS Bank India’s branch network
- Strengthened digital banking services
IDFC Bank Merged with Capital First (2018)
IDFC Bank merged with Capital First in December 2018 to create IDFC FIRST Bank. The merger enabled the bank to strengthen its retail lending portfolio and diversify its customer base.
- Formation of IDFC FIRST Bank
- Expanded retail loan portfolio
- Increased customer reach
- Improved retail banking capabilities
Kotak Mahindra Bank Merged with ING Vysya Bank (2015)
The merger between Kotak Mahindra Bank and ING Vysya Bank was one of India’s largest private sector banking mergers. It significantly enhanced Kotak Mahindra Bank’s branch network and customer base across the country.
- Effective Year: 2015
- Expanded pan-India presence
- Increased branch network
- Improved product offerings
- Enhanced operational efficiency
Earlier Private Sector Bank Mergers
Several important mergers took place before 2015, helping shape today’s private banking industry.
| Acquiring Bank | Merged Bank | Year |
| HDFC Bank | Times Bank | 2000 |
| ICICI Bank | Bank of Madura | 2001 |
| ICICI Bank | ICICI Ltd. | 2002 |
| ICICI Bank | Sangli Bank | 2007 |
| HDFC Bank | Centurion Bank of Punjab | 2008 |
| ICICI Bank | Bank of Rajasthan | 2010 |
List of Merged Public Sector Banks
Following the consolidation drive between 2017 and 2020, six public sector banks became anchor banks by absorbing other government-owned banks. These mergers strengthened the banking system by creating larger institutions with wider branch networks and stronger balance sheets.
| Anchor Bank | Banks Merged | Effective Date |
| State Bank of India | SBBJ, SBH, SBM, SBP, SBT, Bharatiya Mahila Bank | 1 April 2017 |
| Bank of Baroda | Dena Bank, Vijaya Bank | 1 April 2019 |
| Punjab National Bank | Oriental Bank of Commerce, United Bank of India | 1 April 2020 |
| Canara Bank | Syndicate Bank | 1 April 2020 |
| Union Bank of India | Andhra Bank, Corporation Bank | 1 April 2020 |
| Indian Bank | Allahabad Bank | 1 April 2020 |
List of Public Sector Banks Operating Independently
Following the 2020 consolidation, six public sector banks continue to operate independently. Although these banks have been mentioned in media reports regarding possible future consolidation, the Government has clarified that no proposal for further PSU bank mergers is currently under consideration.
| Public Sector Bank |
| Bank of India |
| Central Bank of India |
| Bank of Maharashtra |
| Indian Overseas Bank |
| Punjab & Sind Bank |
| UCO Bank |
Why do Bank Mergers Happen?
Bank mergers are undertaken to strengthen India’s banking system by creating larger, financially stable institutions. The benefits are:
- Improve financial stability
- Strengthen capital adequacy
- Reduce Non-Performing Assets (NPAs)
- Improve operational efficiency
- Expand customer reach
- Increase lending capacity
- Strengthen digital banking infrastructure
- Reduce duplication of branches and operations
- Create globally competitive banks
- Improve risk management
Objectives of Bank Mergers in India
The primary objective of bank mergers is to build a stronger banking ecosystem capable of supporting India’s growing economy. Consolidation helps banks optimize resources, improve profitability, and provide better financial services while ensuring long-term sustainability.
- Build well-capitalised banks
- Improve governance and management
- Enhance operational efficiency
- Strengthen balance sheets
- Improve credit availability
- Support infrastructure financing
- Increase financial inclusion
- Accelerate digital transformation
- Enhance global competitiveness
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