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| Formerly | Canara Industrial and Banking Syndicate Limited |
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| Company type | Public |
| BSE: 532276 NSE: SYNDIBANK | |
| Industry | Banking Financial services |
| Founded | 1925; 101 years ago (1925) inManipal, India |
| Founders |
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| Defunct | 1 April 2020; 5 years ago (2020-04-01) |
| Fate | Merged withCanara Bank |
| Successor | Canara Bank |
| Headquarters | , India |
Areas served | |
Key people |
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| Products | Finance and insurance Consumer Banking Corporate Banking Investment banking Investment management Private equity Mortgages Credit cards |
| Revenue |  ₹23,949.22 crore (US$2.8 billion) (2019) |
| ₹2,819.19 crore (US$330 million) (2019) | |
 ₹−2,588.30 crore (US$−310 million)[verification needed] (2019) | |
| Total assets | ₹3,112,789.86 crore (US$370 billion) (2019) |
Number of employees | 34,054 (2019) |
| Capital ratio | 14.23% (2019) |
| Footnotes / references [1] | |
Syndicate Bank was one of the oldest major commercial banks in India. It was founded by Tonse Upendra Ananth Pai,T. M. A. Pai andVaman Srinivas Kudva. At the time of its establishment, the bank was known asCanara Industrial and Banking Syndicate Limited. The bank, along with 13 major commercial banks of India, was nationalised on 19 July 1969, by thegovernment of India. It was headquartered in the university town ofManipal, India. On 1 April 2020, the bank was merged intoCanara Bank.
Syndicate Bank was founded in 1925 inManipal,Udupi,Madras Presidency,British India. The promoters came from a lower-middle-class background and aimed to improve the socioeconomic status of the region. It was the only Indian bank with its headquarters in a rural area. The bank provided employment opportunities to the educated members of the local community. It had an initial paid-up capital of₹8,000. It was unlike other banks which primarily financed trade and industries in urban areas. So as a new bank, Syndicate Bank decided to exploit the untappedsmall and medium enterprise and the agriculture sector.[2] Thus, Syndicate Bank was focussed on grassroots banking since the beginning.[3]
In 1928, Syndicate Bank started thePigmy Deposit Scheme. Under this scheme, banking agents travel to the doorstep of farmers and shopkeepers at set intervals to collect deposits. By 1960, 21% of the bank's net deposits came from Pigmy Deposits. Its unconventional practices had been criticised by theReserve Bank of India (RBI).[3] Syndicate Bank used to encourage its employees to work as Pigmy Deposit agents, during their spare time. In 1962, RBI barred it from using its employees as bank agents.[2]
In 1950, the share of Syndicate Bank in the banking business was negligible. In 1960, it rose to 1% and to 4% in 1975. In 1968, 32% of its branches were in rural areas, whereas only 22% of branches of the entire banking system were rural. Its loans to the agriculture and small enterprises sector constituted 30% of its total loans, for the other banks it was less than 8%. 90% of its accounts were small accounts i.e., below₹1,500. In 1969, it wasnationalised along with 13 other major banks.[2] In December 1969, it had 350 branches, and by December 1974, it had 700 branches.[4]
In 1975, it established the firstRegional Rural Bank (RRB) of India, Prathama Bank, inMoradabad,Uttar Pradesh.[4] In 1976, Syndicate Bank sponsored the establishment of Malaprabha Grameena Bank inDharwad,Karnataka. In 1983, Bijapur Grameena Bank was sponsored by Syndicate Bank, headquartered inBijapur.[5] In 1984, it also founded Netravati Grameena Bank inMangalore and Varada Grameena Bank inKumta.[6] By December 1986, it had 1456 branches.[4]
In the fiscal year 1996–97, it posted an accumulated loss of₹1,003 crore (US$120 million) and a profit of₹20 crore (US$2.4 million). In December 1997, K. V. Krishnamurti was appointed the chairman and managing director (CMD) of the bank. He found the bank overstaffed which was lowering theemployee productivity. Krishnamurti stopped recruitments and encouragedvoluntary retirement. By 2000, the workforce had been cut by 2,777. The bank leveraged its 1,702 branches and introduced new schemes to mobilise low-cost deposits. In the fiscal year 1999–2000, it posted a profit of₹347 crore (US$41 million).[7]
In the fiscal year 1997–98, it was reported that Pigmy Deposits still contributed 15.6% of its domestic deposits and 5.6% of its global deposits.[3] In October 1999, Syndicate Bank held its firstinitial public offering (IPO). It offered 12.5crore equity shares worth₹125 crore (US$15 million) atpar. The IPO diluted the stake of theGovernment of India to 76%.[8] In February 2000, it was reported that the bank had further reduced its staff strengthen by 2,400 in the preceding two years.[9]
In 2003, Syndicate Bank tied up with theUnited Nations Environment Programme (UNEP) to provide loans to purchase solar lamps.[10] In December 2003, Syndicate Bank announcedsabbatical leave scheme with partial pay to reduce its employee overhead.[11]
In July 2005, it held its equity share offering. 45 million shares with the face value of₹10 were offered at₹46-₹50.[12] In September 2005, the four rural banks in Karnataka sponsored by Syndicate Bank – Malaprabha Grameena Bank, Bijapur Grameena Bank (BGB), the Varada Grameena Bank, and Netravati Grameena Bank, were merged to formKarnataka Vikas Grameena Bank.[13]
In March 2007, the Pigmy Deposit scheme was relaunched as Pigmy 2007. The older scheme was also continued as Pigmy 1928.[14] By March 2015, the bank had opened 3552 branches.[15]
On 30 August 2019,Finance MinisterNirmala Sitharaman announced that Syndicate Bank would be merged withCanara Bank. The proposed merger would create the fourth largest public sector bank in the country with assets of₹15.20 lakh crore (US$180 billion) and 10,324 branches.[16][17] The Board of Directors of Canara Bank approved the merger on 13 September 2019.[18][19] The Union Cabinet approved the merger on 4 March 2020. Canara Bank assumed control over Syndicate Bank on 1 April 2020 with Syndicate Bank shareholders receiving 158 equity shares in the former for every 1,000 shares they hold.[20]
On 3 August 2014, the CMD of the bank, Sudhir Kumar Jain, and 11 others were arrested by theCentral Bureau of Investigation (CBI). Jain was accused of taking bribes to extend the credit limits of companies.[21]
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