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Moratorium To Merger Of Private Banks - Regulatory Rhyme And Reason, Aparna Meduri, Gopala Krishna Vavilala

Aparna Meduri

This paper analyzes the regulator's role in imposing moratorium on a sick bank. Moratorium and subsequent merger of Global Trust Bank with Oriental Bank of Commerce is critically debated in this article with contextual reference to the existing legal regime and regulatory regime in India. The authors address serious concerns of delayed surveillance over weaker banks and emphasize the need for meeting the test of reason, while deciding the merger of a weak bank with a healthy bank. The article also examines some inconsistencies in initiating similar measures in case of cooperative banks. An attempt is also made to evaluate …