Finance Minister announces merger of 27 banks into 12

This follows a series of steps taken by the Finance Ministry recently to give a boost to the sagging economy.

In the latest development, Punjab National Bank, Oriental Bank of Commerce, United Bank, Canara Bank, and Syndicate Bank will be merged into one major bank while Union Bank of India, Andhra Bank, Corporation Bank, Indian Bank and Allahabad Bank will be merged to form another major bank.

The government's action comes in the wake of GDP slowing down to 5 per cent during April to June quarter. In the earlier quarter, it was 5.8 per cent.