Mumbai: As it moves ahead with the ING Vysya Bank deal, Kotak Mahindra Bank today said the merger secures all employees and would create growth opportunities for various stakeholders including the staff members.
The Uday Kotak-led bank said that it fully stands by and is obligated to comply with sections related to employees' job security, wages, pension including Dearness Allowance linked adjustments, provident fund and gratuity among other benefits.
The Rs 15,000-crore deal was announced in November 2014 and would create the fourth largest bank in the country with a total staff size of nearly 40,000.
The shareholders of the two banks are scheduled to meet on January 7 for their respective EGMs to approve the deal. In the meantime, employee unions of ING Vysya Bank have demanded protection of their job and other benefits post the merger and have also threatened to go on strike.
Seeking to assuage the concerns of the employees, Kotak Mahindra Bank said in a statement: "All protection related to employees have already been captured in the Scheme of Amalgamation which upon approval by RBI, Kotak Mahindra Bank shall fully standby and is obligated to comply with ...."
"The merger process entails as per the Banking Regulation Act, approval of the shareholders and thereafter approval from the Reserve Bank of India (RBI) in addition to Competition Commission of India's (CCI) approval, the bank said.
"As is evident we would like to start with good faith constructive approach that secures all employees and create growth for all stakeholders including employees after RBI's order," a bank spokesperson said.
Soon after the announcement of the deal, Kotak group chief Uday Kotak had said: "We are going to position ourselves as a world-class financial institution...on combined basis, we would have 40,000 employees."
When asked whether there could be any job cuts, he said, "The core of our business strategy is growth and building business synergies and it is not around reckless cost cutting at all. That is not the focus of what we want to do.
"We do not believe that there will be a situation where we will have an inability to provide our people growth opportunities. We will have enough potential to provide growth opportunities to our people across all segments and regions."