Both
BOB & Vijaya Bank Managements need to be congratulated for having accepted
a sick (beyond cure) baby (Dena Bank)- they will be paying heavily for this
bravado in the next 5 years.
There
has been a sigh of relief for the Staff members of Dena Bank since it's gross
NPA as on 31.03.18 is Rs 16,314 Crores & Loss declared for the full year is
Rs 1,923 Crores. With a meager operating profit of Rs 1,171 Crores during
2017-18, Dena Bank is on the Ventilator for the last 3 years with guaranteed
death. When the net loss is much more than the entire years operating profit
& with 16,361 Crores of NPA in its books, Dena Bank with 65% business from
Gujarat state is grateful to Modiji for the rescue act. Equally important is
that the political leadership is partly responsible (albeit
indirectly) as the cause of sickness is also attributed to Gujarat with Agrill. & Corporate Loans in the BJP strong hold state being the major contributors
for the decay. For the past 1-2 decades,Dena Bank is ill known for its poor
compliance culture which has landed the Bank in this mess.
Many
posts of Chest beating by BOB staff are being circulated claiming BOB as a big
Bank with huge business & lots of staff benefits. The fact of the matter is
that BOB with many foreign branches is in a complete mess. Look at the cold
facts:-
01)
The grandiose foreign branches are making consistent losses & the Indian
operations is subsidising the losses from foreign operations.
02)Gross
NPA of BOB is 56,480 Crores. With 16,316 Crores of Dena Bank, it totals to
72,842 Crores. With total annual operating profit of 12,005 of BOB+1,172 Crore
of Dena Bank, it will be a herculean task to declare profit in the next 5
years. Assuming even a modest haircut of 50 %, profit required to write off the
haircut portion will be Rs 36,000 Crores which will consume at least 5
years profits on a conservative basis. Considering the big borrowers of BOB,
actual haircut may come around 70% in which case it will be
consuming 7 years profits.
03)BOB
has higher quantum of staff benifits. Slightly higher HRR & other perks
appear rosy. But the lack of peace of mind/lack of sleep for the next 5-7 years
are not worth the slightly higher perks. Staff members of smaller Banks
with much smaller benifits will show quantum jump in business/ profit in this
intervening 5-7 years.
04)BOB
staff has a very bad Work Life Balance. Despite tall claim by the Management,
field level staff sit very late everyday & work on holidays. They are being
paid extra amount for late sitting/holiday working- so staff have become used
to pretensious working. These are going to take a heavy toll on the health of
staff of the combined entity, post merger.
These
extra payments are bound to dry up sooner than later. BOB used to pay Rs 3,000
per day for holiday working earlier which is now slashed to Rs 2,000 per day.
This unsustainable model is bound to crash wherein staff will be forced to sit
late/ holiday working without extra monetary benifits.
05)Un
reasonable Transfer Policy- Mandatory transfer out after 6 years even in
deficit zones coupled with no exemption for Ladies, Transfer in after 6 years(2
terms) are very cruel . Transfer exercises on a quarterly basis (as against
once in a year in April/May in Vijaya Bank) is sure to disturb every one.
06)Executives
of Dena & Vijaya will be in a shock to find that there are at least 25
Consultants in BOB drawing Rs 35 to 150 lakhs package per year- out of which
,at least 10 Consultants are drawing a package of Rs 50 lakhs, one drawing Rs
150 lakhs, two are drawing Rs 100 lakhs package. This indicate an unjust
remuneration system but also stiffle promotion opportunities in Executive
cadres.
These
are the bitter truth. For the Dena Bank Staff it is a Win Win scenario as they
have nothing to lose .Dena Bank staff including Officers are celebrating.
Despite tall claims, Officers Associationion(AIBOC) in Dena Bank is happy
with the merger - their Demonstration etc is just a drama to show to outside
trade unions that they oppose mergers. AIBOC Unit in Dena Bank is in a mess for
the last 2 years as they could not get even the Request Transfers( without
TA/DA) done in the past 2 years(2017 & 2018 exercise). Thus AIBOC
leadership in Dena Bank is in a deep crisis- if there is an election today, all
the sitting Office Bearers will lose heavily.
BOB
has about 5,000+ INBOC(Congress) and 1,000 AIBOC under Office cadre. About
20,000 Officers are under no Association. Thus the merged entity may see a
dominant role by the BOB Management- so far BOB Management has been fair in
their approach to Unionised INBOC / AIBOC members or No Union members. With
increased attention from the Govt & Industry watchers, BOB Management is
not expected to take any harsh steps on Officers (at least for 1-2 years) just
because they are members of some trade union/ association. After all, AIBOC is
known for advocating fair & ethical working by its members and in
most of the Banks , Executives upto the cadre of General Managers are members of
AIBOC.
Award
staff Unions are a confused lot. With 10,000+ NCBE Members & a strong Shiv
Sena Award staff union in BOB, AIBEA award staff Unions in Dena & Vijaya
are going to face trouble since the NOBW Union in Vijaya Bank is sure to side
with Shivsena or NCBE ( will not join AIBEA given its long rivalry). It will be
a rough ride for AIBEA (despite its good membership position in Dena &
Vijaya Bank), which is known for anti Management approach in the past in
many Bsnks, as compared to the pro Management approach of NCBE & NOBW
Unions.
The
above facts are brought to the fore so that rejoicing members of Vijaya
& BOB are made aware of the bitter truth- a harsh reality that the next 5
years in the merged entity will not be a bed of roses. Merger will see closure
of the Branches & will truncate promotion opportunities for BOB &
Vijaya Bank Officers who are accustomed to quick promotions all these years
Officers
of BOB will also face transfers to South as many of them working in 1,200+
branches in UP & 1,100+ Branches in Gujarat have hardly worked in South
India. It will be a painful realisation for BOB Officers that all is not hunky
dory in the merged set up & the so called jubilant mood will evaporate
sooner than expected.
We
are not trying to scare any body- just the cold facts are jotted down which
should be known to the Employees of the merged entity so that they can begin
the journey with moderate expectations.
Friends, Government and Management of all the three Banks are trying assuage
the hurt feelings of the staff by promising retention of Identity & Emblem.
Let us all remember that these statement of intent are farce & has no
meaning or relevance. Even if you call it amalgamation, it will be nothing but merger. Probably it
will be anti climax - Vijaya Bank guys are good in Recovery, Dena Bank guys are
good in adopting to lousy postings to the worst rural branches & BOB staff
are the elite staff who are good in Corporate lending (having created a huge
mess of Corporate NPA mess)- all will be assigned the role best suited to
them.
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