As part of its most recent banking reforms, the Indian government is planning to combine Union Bank of India and Bank of India, two PSU institutions with headquarters in Mumbai, according to Mint, which cited persons with knowledge of the situation. According to the report, if the merger is completed, State Bank of India (SBI) will become the nation's largest state-run bank.
The report also stated that during the coming years, the government intends to expand the number of lenders and simplify overlapping banking activities.

With total assets of Rs 18.62 trillion as of June 30, Bank of Baroda is currently the second-largest public sector bank. It comes in fourth place among all banks, behind SBI, HDFC Bank, and ICICI Bank.According to the research, the combined Union Bank of India and Bank of India entity will have total assets of Rs 25.67 trillion, which is comparable to ICICI Bank's asset base of Rs 26.42 trillion.
According to sources cited by Mint, the Finance Ministry is also examining possibilities to combine Indian Overseas Bank and Indian Bank, two lenders with locations in Chennai. According to the article, Bank of Maharashtra and Punjab & Sind Bank (PSB), which have fewer assets than the other significant PSU lenders, are being contemplated for privatisation at a later date.

Moneycontrol exclusively revealed earlier on October 15 that the government is preparing a massive merger that would combine smaller lenders with larger banks, paving the way for yet another round of public sector bank consolidation in India's banking industry.

According to a source, the goal is to simplify the PSB landscape so that there are fewer, more powerful organisations that can assist with the upcoming stage of credit growth and financial sector reforms.
According to government sources, major banks like Punjab National Bank (PNB), Bank of Baroda (BoB), and State Bank of India (SBI) may combine with Indian Overseas Bank (IOB), Central Bank of India, Bank of India (BOI), and Bank of Maharashtra (BOM).

The government combined 10 PSBs into four larger organisations between 2017 and 2020, increasing the number of state-owned banks from 27 in 2017 to 12.
Syndicate Bank merged with Canara Bank during this time, and Oriental Bank of Commerce and United Bank of India merged with PNB. The goal of the consolidation was to build more robust, well-capitalized banks that could compete on a worldwide scale.