Strategic Mergers in Urban Co-operative Banking – a Case Study of Cosmos Co-operative Bank Ltd.

Abstract

Urban Co-operative Banks (UCBs) in India are slowly accepting the idea of mergers and amalgamations as a means of expansion and better services. This paper therefore focuses on the role of strategic mergers in the growth of UCBs especially Cosmos Co-operative Bank Ltd. (Cosmos Bank) in terms of growth of their branch network, increase in business and extension of their operational footprint. The study focuses on the process of selecting merger partners by Cosmos Bank, the outcomes of these mergers, and the impact on the financial performance, customer satisfaction, and operational effectiveness. Additionally, the paper examines the role of mergers in protecting the interests of depositors, particularly in weaker banks or banks that are under restrictions imposed by the Reserve Bank of India (RBI). It also examines the regulatory framework of such mergers and the overall impact of consolidation in the co-operative banking sector. By analysing the approach of Cosmos Bank to mergers, this paper attempts to provide valuable insights for the future of UCB mergers in India.