Bank Mergers in India (1993–2025): Full List, History, and Impact on Banking Sector

The Indian banking system has gone through a major transformation over the last three decades. From small regional banks to large financial giants, mergers and amalgamations have completely reshaped the banking landscape. Between 1993 and 2025, several key mergers took place some to strengthen public sector banks, some to rescue weak institutions, and others to create global-scale entities. Let’s look at the full timeline, reasons, and how these mergers have impacted India’s financial ecosystem.

Bank Mergers in India (1993–2025): Full List

Here’s a complete look at the most significant mergers during this period:

History of Bank Mergers in India (1993–2025)

1. SBI and Its Associate Banks (2017)

The biggest merger in Indian banking history SBI combined with its five associate banks and Bharatiya Mahila Bank. This move made SBI one of the top 50 global banks and improved operational strength, though the integration took time due to massive employee and system realignment.

2. Bank of Baroda, Dena Bank & Vijaya Bank (2019)

This merger was India’s first-ever three-way amalgamation in the public sector. It created India’s second-largest PSB with a wider customer base, but required significant backend alignment.

3. 2020 PSB Merger Wave

Four large mergers reshaped the public banking map:

• PNB became the second-largest PSB after merging OBC & United Bank.
• Canara Bank merged with Syndicate Bank.
• Union Bank merged with Andhra & Corporation Bank.
• Indian Bank merged with Allahabad Bank.

These steps reduced the number of PSBs from 27 to 12, making them more efficient and competitive.

4. HDFC Ltd + HDFC Bank (2022)

This was a landmark private sector merger, combining housing finance and banking. It created a financial powerhouse with deep reach in both retail and corporate segments, setting a new benchmark for scale and innovation.

5. Yes Bank Rescue (2020–2025)

After facing a liquidity crisis, Yes Bank was revived by the RBI and a group of investors led by SBI. Later, Japan’s SMBC Group acquired a major stake in 2025, signaling growing global interest in Indian banking.

Why Did These Mergers Happen?

1. To Create Stronger Banks: Many public sector banks were struggling with rising NPAs (bad loans). The government merged smaller PSBs into larger ones to strengthen their financial position.

2. To Improve Efficiency: Mergers helped banks reduce duplication of services, save operational costs, and expand their reach under a unified system.

3. To Handle Financial Stress: In cases like Yes Bank (2020), mergers and restructuring were necessary to protect depositors and prevent a banking crisis.

4. To Compete Globally: Mergers like HDFC Ltd + HDFC Bank aimed to create larger entities capable of competing with global financial giants and supporting large-scale credit growth.

5. Digital & Technological Integration: Combining systems helped banks adopt modern banking technologies faster, enhancing customer experience and data management.

Impact of Bank Mergers on the Indian Banking Sector

Bank mergers have strengthened the Indian banking sector by improving capital adequacy, operational efficiency, and digital reach. However, they also brought integration challenges and reduced competition among public sector banks.

Positive Impacts

• Larger and stronger balance sheets for funding infrastructure and large projects.
• Improved capital adequacy and efficiency due to reduced duplication.
• Wider customer base and digital reach across urban and rural India.
• Better risk management and governance after consolidation.

Challenges

• Integration of employees and systems often caused short-term disruptions.
• Cultural differences between banks affected productivity initially.
• Reduced number of PSBs also meant less competition in the sector.