Banks seem to be dreaming big again. Sources said Canara Bank plans to buy Dena Bank. It has even appointed a consultant - E&Y - to do the preliminary groundwork.
Canara Bank has a strong presence in the south and has a network of 2,542 branches while Dena Bank with its 1,050 branches has a strong presence in Gujarat and Chattisgarh, where Canara is not particularly strong.
The financial complimentarily is there. Canara Bank’s rapidly growing asset book stands at Rs 1,53,339 crore, that is five times Dena Bank's asset book of Rs 29,160 crore. Given its troubled past, Dena Bank's gross NPAs stands at 4.9% compared with Canara Bank’s 2.06%.
Net interest margin of the two banks are about the same at 3%, but Canara Bank's price to book is better at 1.21 as against Dena's 0.89.
But financials alone will not be sufficient for the eventual buyout. The much-talked merger of Bank of India and Union bank fell through because of the Left and Centre’s pressure, which the government was unwilling to take on. M B N Rao, Chairman, Canara Bank, completely denied the story while Dena Bank’s Chairman could not be reached. However, winds from Delhi indicate something is brewing.
2 comments:
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Canara Bank in CHENNAI City Sucks big time.
The Change they talk about is only on the logo and their name boards.
The same un-welcoming employees & their stupid processes still exist.
I had a employee of the Mylapore branch tell me "What the helll does the management know the way we suffer here?" Suffer? I wonder if Canara Bank is ill-treating them ;-)
Getting a cheque book is the most difficult part.
Thank god I switched to ICICI and Axis bank for good long time back, while my father an employee of INDIA TODAY still is forced to use CANARA Bank.
Agni Sharman
Banks in Kerala
www.fly2kerala.com/tourism/banks.htm
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