sector and private banks show they are a timeconsuming exercise we believe operating expenses could go up in the near to medium term banks would also face higher expenses related to vrs says kumarhow financials of anchor banks will change after mergers source kotak securitieshow the mergers stack upamong the four mergers the combined entity of allahabad bank and indian bank will have the lowest net npa non performing assets while boasting the highest provisioning coverage and strongest casa current account and savings account franchise indian banks merger with allahabad bank will help it emerge as a strong entity with reach improving provisioning coverage ratio pcr and strong casa ratio suggests bumb the merged entity also has the least branch overlaphowever this diversity in cultures may prove challenging during integration and may also lend no major cost benefits from the merger further indian bank will see deterioration in its asset quality owing to allahabad banks unhealthy loan book meanwhile greater synergies are likely to accrue from the merger of syndicate bank with canara bank as both have similar cultures and geographical presencethe merged entity will become the fourth largest lender in the country with better provisioning and capital ratios postmerger the combined entity of union bank will see improved provisioning and capital ratio after merger with andhra bank and corporation bank however its asset quality position will take a hit with the merged bank likely to report the highest gross npa ratio among the four entitiesalso read bank mergers which customers will be affected and howanalysts favour rival public sector and private banks while most of the anchor banks will take a nearterm hit on asset quality shareswap ratios for the merger will not favour the smaller banks shares of these merging banks have corrected sharply since the announcement analysts recommend staying away from merging entities till more clarity emergessbi and bank of baroda along with the leading private banks axis bank icici bank and hdfc bank would be in a stronger position for the next few years while transition issues rankle other public sector banks reckons kotak securities the brokerage believes that under its swap ratio assumptions the negative impact would be the highest for union bank and indian bank the mergers will keep staterun banks busy in the integration process for a long time and thus help private banks further consolidate their business market share suggest emkay global analysts anand dama and rahul malani they retain buy on sbi and maintain positive bias towards leading private banks with icici bank and hdfc bank among the top picks