Since the onset of reforms, there have been about 32 mergers / amalgamations in the banking sector. Prior to 1999, most of the mergers were driven by resolution of weak banks under Section 45 of Banking Regulation Act 1949. However, after 1999, there has been increasing trend of voluntary mergers under Section 44A of Banking Regulation Act 1949.
As noted above, most of these Section 44A mergers were among private sector banks. PSBs have bypassed this trend despite the fact that there might have been ample opportunities of creating value through strategic mergers and acquisitions among two PSBs. Some caveats 15. Having said that Consolidation in PSBs is worth considering, I would hasten to add certain caveats. 16.