The Regulatory Authorities On Mergers And Acquisitions In The Indian Banking Sector: A Case Study
- IJLLR Journal
- Jun 26
- 1 min read
Dr. Gayathri N M, Assistant Professor, CMR University School of Legal Studies
Mr. Javed Akthar Shaik, LL.M. (Commercial Law), CMR University School of Legal Studies
ABSTRACT
The Indian banking sector operates within a highly regulated framework, primarily overseen by the Reserve Bank of India (RBI). As the central authority, the RBI plays a pivotal role in ensuring financial stability while guiding banks in fulfilling their responsibilities. Despite rigorous oversight, banks consistently seek expansion and profitability, with mergers and acquisitions (M&A) emerging as a key strategy to strengthen market presence.
This study explores the regulatory and commercial dynamics surrounding M&A in the Indian banking sector, focusing on the interplay between the RBI and the Competition Commission of India (CCI). It examines the policies governing voluntary and compulsory mergers under the Banking Regulation Act of 1949, highlighting how RBI directives have evolved in response to industry needs. Additionally, the regulatory processes for public sector bank mergers, involving RBI consultation and government approvals, are analysed. Through an examination of the typical bank merger process, this research underscores the significance of a structured regulatory framework in ensuring financial stability, fostering growth, and safeguarding stakeholders in India's banking industry.
Keywords: Banking sector regulation, Reserve Bank of India (RBI), Mergers and acquisitions (M&A), Competition Commission of India (CCI), Banking Regulation Act, 1949, Voluntary and compulsory mergers, financial stability, Depositor protection, public sector banks, Market expansion, corporate governance, Regulatory framework, Disclosure and compliance, Economic impact of mergers.
