PSU Banks Merger: IOB, BOI, BOM, Central Bank, UCO, PSB Merger In April 2026? List Of Major Bank Mergers

The focus on Indian PSU bank mergers has once again returned, with the government looking to create fewer but world-class banks that could compete in the top 100 global rankings. The largest PSU lender, State Bank of India (SBI), is also supporting the next phase of bank consolidation to earn more and increase market value. As of now, there are a total of six PSU banks whose fate for merger is yet to be decided. Among major objectives for bank mergers are strengthening financial books, trimming bad debts, boosting digital and physical infrastructure, and improving global competitiveness.

Which Banks Are Not Merged?

There are six banks that are currently in the PSU banking system as single entities. These are

- Bank of India

- Indian Overseas Bank

- Central Bank of India

- Bank of Maharashtra

- UCO Bank

- Punjab & Sind Bank

Big Bank Mergers in India From 1993 To 2025

In more than three decades, the Indian financial system has seen significant transformation, and merger of two or multiple banks to form one uniform and strong bank is part of this paradigm shift.

As per the Angel One blog, the bank mergers have resulted in better capital strength and improved credit capacity, enhanced technology integration for smoother services, greater risk diversification, and reduced branch overlap and operational costs.

Here are some of the important banks merger since 1993:

1. April 2017

SBI + State Bank of Bikaner And Jaipur + State Bank of Hyderabad + State Bank of Patiala + State Bank of Mysore + State Bank of Travancore + Bharatiya Mahila Bank

In April 2017, SBI merged six of its associate banks, becoming the largest PSU bank in the country. SBI was the first experiment when the banks consolidation idea was sparked in 2017. The idea of having fewer but stronger PSU banks was first introduced by former Finance Minister Arun Jaitley.

2. April 2019

Bank of Baroda + Vijaya Bank + DENA Bank

Baroda Bank added the two banks under its ambit, which led the bank to become third largest PSU bank in India.

3. April 2020

Punjab National Bank + Oriental Bank of Commerce + United Bank of India

By merging Oriental Bank of Commerce and United Bank of India, PNB became the second-largest PSU bank in terms of branch network.

4. April 2020:

Canara Bank + Syndicate Bank

This Bengaluru-based bank is now the fourth largest public sector bank in India after it merged Syndicate Bank.

5. April 2020:

Union Bank of India + Andhra Bank + Corporation Bank

Union Bank became the fifth largest PSU lender in India after merging with Andhra and Corporation Banks.

6. April 2020

Indian Bank + Allahabad Bank

Because of merging Allahabad Bank in its network, Indian Bank is now the seventh largest PSU bank of the country.

Which PSU Banks Could Merge Next?

It needs to be noted that all these mergers took place in April, the start of a financial year from 2017 to 2020. Although Finance Ministry has not revealed any official date for the next phase of bank merger or the details of which bank will merge with whom, it will be keenly watched if major announcement will be made in April 2026.

As per media reports, the FinMin is likely drawing up a roadmap for the next round of PSU bank consolidation, with a formal announcement expected in April-May. Unlike previous one-time merger packages, the new strategy is expected to be executed in two to three tranches, enabling smoother integration and better capital alignment, cited by PL Capital.

PL Capital also stated that officials quoted in the report said that the government's long-term objective is to reduce the number of PSU banks from the current 12 to about 6-7 larger, more competitive institutions. The consolidation will focus on building lenders with stronger balance sheets, improved lending capacity and better operational efficiency-particularly to support India's expanding infrastructure pipeline.

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