Consolidation should not be seen from the sole perspective of creating larger sized banks. While it is agreed that under present banking structure in India, creating a few large size banks is desirable, it has to be a well calibrated and cautious process. Suggested Consolidation Process 19. Ideally, the process has to be initiated by the boards of individual banks themselves.
NC-I had also mentioned that any move towards restructuring and reducing the number of banks through mergers and acquisitions should evolve on the basis of market driven and profitability considerations and with understanding and support from bank officers and staff. The committee had emphasized on the voluntary character of the exercise to avoid the type of problems associated with a top down approach. 20.