State-owned Indian Bank has been featured in the Harvard Business Publishing for its successful merger of Allahabad Bank.
The first-of-its-kind seamless merger of equal sized Indian banks with prominence in the southern and eastern region of the country has been well recognized and published by Harvard Business Publishing as a case study.
Curated by Indian School of Business (ISB), this case study titled 'Merger of Equals: The Amalgamation Story of Indian Bank and Allahabad Bank' encapsulates the journey that Indian Bank embarked on, to successfully execute the amalgamation process.
'Merger of Equals' narrates the entire integration process which comprised rigorous strategic planning and execution by Indian Bank with impetus on the challenges faced and their answers found. The merger has made Indian Bank, a pan-India lender with significant presence in southern, northern and eastern parts of the country.
The amalgamation exercise 'Project Sangam' had a three-pronged approach on product/process, employee-customer communication and IT integration.
The synergy benefits of the merger have started reflecting in terms of cost efficiencies as evidenced from the decline in cost-to-income ratio of the Bank (40.86 per cent for QE June 2021). The integration of IT operations and systems have also resulted in economies of scale through vendor rationalisation, finer pricing on AMCs and improved operational efficiencies.
Padmaja Chunduru, MD and CEO, Indian Bank said, "We are privileged to witness our amalgamation process featured in the leading publication of one of the most prestigious institutions of the world. This is a testimony to the constant dedication and sincerity of the entire Indian Bank team which helped achieve this strategic merger. We would like to take this opportunity to thank ISB and Harvard Business Publishing for acknowledging the efforts of Indian Bank. The merger has given Indian Bank a distinct experience of building synergies between two banks with vast legacies. We hope this case study will help readers understand the big picture of this exemplary merger."
The two banks merged efficiently while addressing the challenges of human capital, varied cultures and geographic locations.
Indian Bank is the seventh-largest public sector bank in India. Established in 1907 and headquartered in Chennai, the bank serves over 10 crore customers with 41,557 employees. With effect from 1st April 2020, Allahabad Bank got merged into Indian Bank.
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