No share swap arrangement between GTB and OBC

Our Banking Bureau
27 July 2004

Mumbai: Global Trust Bank (GTB) is to be merged with the Oriental Bank of Commerce (OBC). This was announced by the Reserve Bank of India on Monday.

GTB will continue to be under the moratorium till the merger date is officially notified, Usha Thorat, executive director, RBI said at a press conference called to announce the merger.

GTB was placed under a moratorium by the government three days ago.

RBI has announced a draft scheme of amalgamation, which will be implemented after August 7; until then stake holders of both banks are given time to submit their suggestions and objections on the scheme, if any. OBC has notified the proposal to the stock exchanges.

Thorat said the merger date would be announced after the scheme is approved by the government and till then the moratorium will be in force. This means, customers of GTB will not be able to do any transactions with the bank apart from those permitted under the moratorium at least till August 7.

Thorat said the RBI is open to increasing the Rs 10,000 limit on withdrawals. "Nothing prevents us from hiking the limit at a later date," she said responding to a query.