The Kerala government will now be able to set up its own bank by merging district co-operative banks as the Reserve Bank of India (RBI) gave the final approval for the move.
The proposed "Kerala Bank" will be largest banking network in the state.
Chief Minister Pinarayi Vijayan said the "Kerala Bank" would be formed amalgamating the district co-operative banks (DCBs) with Kerala State Co-operative Bank."
According to PTI, 13 DCBs would be merged with the Kerala State Co-operative Bank for forming the proposed bank.
The government had said that the objective of the formation of the Kerala Bank was to strengthen the cooperative banking sector, however, while the opposition alleged that it would destroy the traditional cooperative sector.
All DCBs, except the one in Malappuram district, controlled by the opposition Congress-led UDF, had approved the Left government's proposal of amalgamation in their respective general body meetings, PTI reported.
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