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Cosmos Bank Absorbs Troubled SDC Bank in Voluntary Merger

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Cosmos Bank, headquartered in Pune, has completed the voluntary merger of Sahebrao Deshmukh Co-operative (SDC) Bank, adding 11 new branches to its network. The merger was approved by the Reserve Bank of India (RBI) and marks a strategic move amid competitive pressures and challenges faced by smaller cooperative banks.

Reasons for Merger

  1. Intense Competition: Smaller cooperative banks have found it increasingly challenging to compete in the current competitive banking landscape, prompting strategic mergers to strengthen their positions.
  2. Sustainability: SDC Bank’s decision to merge into Cosmos Bank reflects the difficulties faced by smaller banks in sustaining their operations independently.

Key Merger Details

  • Cosmos Bank will benefit from additional deposits amounting to Rs 143.40 crore as a result of the merger.
  • The RBI had imposed restrictions on SDC Bank in July 2022, including withdrawal caps for depositors, which likely contributed to the merger decision.
  • The merger expands Cosmos Bank’s branch network in Mumbai to a total of 50 branches.
  • Cosmos Bank’s commitment to securing the funds of all depositors, despite its current “negative growth,” was emphasized in the merger announcement.


The merger of SDC Bank into Cosmos Bank represents a response to the challenges faced by smaller cooperative banks in India’s competitive banking environment. It highlights the strategic importance of consolidation for sustainability and growth in the sector. Cosmos Bank aims to leverage this merger to enhance its presence and services in the Mumbai region while providing assurance to depositors of both banks regarding the safety of their funds.


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