By Shivanand Pandit

The Indian government is reportedly preparing a major overhaul of the public sector banking landscape by merging smaller Public Sector Banks (PSBs) with larger ones, ultimately creating four strong, consolidated banks. Under the proposed plan, institutions such as Indian Overseas Bank, Bank of Maharashtra, Central Bank of India, and Bank of India may be merged with leading banks like the State Bank of India, Punjab National Bank, and Bank of Baroda. If executed, this restructuring could reduce the number of PSBs in the country to just four by FY 2026-27, to improve efficiency, reduce non-performing assets, and enhance global competitiveness.

In parallel, the government intends to open senior management roles in PSBs to professionals from the private sector, beginning

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