India\\\'s Kotak Mahindra and ING Vysya banks merge

MUMBAI, Nov 21 (AFP): India's Kotak Mahindra Bank announced Thursday that it is merging with ING Vysya, part-owned by Dutch group ING, as the banking industry faces pressures including competition from new entrants, bad loans and subdued economic activity.
The merger still needs to be approved by the shareholders, the Reserve Bank of India (RBI) and the Competition Commission of India, a press release from Kotak Mahindra said.
The proposed deal will see every ING Vysya shareholder get 725 shares of Kotak Mahindra Bank for 1,000 shares of the former.
"I firmly believe this merger will pave the way for a bigger and better financial services player with deep Indian roots and global standards of service," said Uday Kotak, executive vice chairman and managing director of Kotak Mahindra Bank in a statement.
Bad loans at Indian banks have surged to a three-year high, a report from global rating agency Moody's stated last month, as Asia's third largest economy slowed to its weakest growth rate in nearly a quarter of a century.
The merger also comes at a time of increasing competition, after the RBI granted two new bank licences a few months ago, with more expected.
"Our two companies are a perfect match at a perfect time," said Shailendra Bhandari, managing director and chief executive officer of ING Vysya Bank.
"Our customers will see tremendous value from the combined entity as we fill the gaps, in terms of a much larger footprint and a complete product suite, both national and international," Bhandari said.