REQUEST FOR CLARIFICATION

[vijayakumar T D]

Respected  members,

            I took VRS from ING 4 years back and receiving pension  without any except that bank is not accepting investment  declaration
for IT credit.

             As you all know that ING vysya bank being taken over by Kotak Mahindra Bank. In this context I request
learned members to clarify:

-  Can Kotak bank stop payment of pension to exisiting pensioners

-  Can they refuse pension for employees who are still in service and opted for pension

-   Can they pay pension in future without linking it to variation in DA

-   While giving permission to takeover will the RBI rule that all welfare measures to employees are to be continued



      I hope to receive clarification from the blog.

Thanking you all,


Vijaykumar
 
     

 
             



               

[PM]

Dear Mr.Vijaya Kumar,

                                       While  taking into account the  market capitalization, Kotak Mahindra Bank is the fourth largest Indian private sector bank  headquartered in Mumbai.It  is the first company in the Indian banking history to get RBI license to convert to a bank in Feb.2003.

               The over all picture of Kotak bank is as follows:The Bank has  a deposit base of 59072 crores and advance figure of Rs.53027 cr .The net profit was Rs 1503 cr and the gross NPA at Rs 758 cr and Net NPA at Rs 574 cr.over as on 31^st March 14. It has  600 branches and over 1,100 ATMs spread across 354 locations in the country as on 30^th June 2014..

             As you may be aware,ING Vysya Bank  is having a deposit base of Rs.41216 cr and advances of Rs.35828 cr with net profit of Rs.658 crG NPA Rs 263 cr and Net NPA at Rs.102 cr.

Certainly the take over may bring Kotak to 4^th position among all private banks in the country.But these figures and position need not  be a positive  indication when sorting out employees/retirees issues of merged bank.

        When  we   look at the pros and cons of bank mergers  we have  to see at the subject on a case by case basis as each merger has a different possible benefits and costs. There may be advantages and disadvantages of a merger.We  need to think about the possible impact on employees/retirees of merged bank.

Coming to your point:

Unless we know  exactly the specific  terms and conditions of merger we cannot assume things and clarify on points raised by you.

1.However,one thing is clear that Kotak Bank cannot or will not stop the pension payment to retirees of merged bank.

2.We do not have  specific terms and conditions before us now, on what are all points on the merger was agreed.How the bank is going to proceed in matters related retirees issues as well as of employees of merged bank shall be based on such agreed terms.

3.If the pension payment is made in tune with Bank Employees Pension Regulations 1995 Payment of DA to pensioners will also be according to that regulation approved by that Bank’s board earlier.

4.Though stipulations are there on allocation of funds for staff welfare measures how bank  will go in future etc will be based as per terms of agreement

                   Hence it is ideal to wait till  the specific terms and conditions of merger are known especially with regard to matters related to employees/retirees of merged bank.

[Mohandas Rao]

Dear Sri Vijayakumar,

        ING Vysya Bank [it was formerly The Vysya Bank Ltd] is a member of IBA and the Bipartite Settlements signed so far, including Pension Agreements are binding on it. Pension is a deferred wage and the pension payments are made through the pension funds of the concerned bank. The fund consists of bank's contribution of PF, interest thereon, etc. Continuance of payment of pension is a legal responsibility of the bank.

        Even after merger with Kotak Mahindra, the Kotak Mahindra has the responsibility of continuing payment of pension.

        For example, a customer has a fixed deposit with ING Vysya Bank, which is not yet due. It becomes due only after merger with Kotak Mahindra. Will Kotak Mahindra refuse payment on the ground that it was kept with the ING Vysya Bank? No. Likewise a borrower of ING Vysya Bank cannot escape repayment to Kotak Mahindra Bank, if his liability is not fully repaid before merger. Thus Kotak Mahindra is taking both the Assets and Liabilities of ING Vysya Bank when merger takes place.

        Hence payment of pension, procedure of calculation of DA etc will continue as it is, even if it is taken over by Kotak Mahindra, unless it is changed in all the other banks as per subsequent Bipartites.

K. MOHANDAS RAO, SBM-VR 2001

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[R Krishnan]

Dear Friends

I am forwarding a mail from my brother who is working in ING and on merger to Kotak Mahindra bank clarifying the points raised therein.

Regards

Krishnan

 

From: chel...@gmail.com [mailto:chel...@gmail.com]
Sent: Saturday, November 29, 2014 10:18 PM
To: Kannan
Subject: Re: bankpensioner REQUEST FOR CLARIFICATION

 

He will get the pension without any issue. However, our union & association is all steps to protect the interest of present & future retires.
Sent from my iPad

On Nov 29, 2014, at 5:39 PM, Kannan <kan...@gmail.com> wrote:

Pls let me know

Sent from my iPad 

 

Begin forwarded message:

--

[cpvnair]

Many of us seem to have such imaginery apprehensions.How can a bank withhold the staff/retirees legitimate dues after merger ?It is not a liquidation or any similar process.These banks merge to only to prosper more and not to destroy the employees or the retirees.Moreover, we should repose more faith on OUR UFBU which should ensure that the interests of the staff/retirees are retained INTACT.After going through the clarifications from our learned colleagues Shri P Mohanji and Shri Mohandas Raoji, I feel that such apprehensions should be PUT TO REST.

 

 

warm reg

 

 

CPVNAIR

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[Anantharaman Tg]

Dear All,

When merger takes place, everything connected with the acquired Institution

(in this case ING Vysya Bank) is taken over by the acquiree So it is the responsibility of Kotak Bank to protect the interests of all including the retirees

of merging Institution.

Therefore, not only the existing employees, but also the ex-employees' interests, as existing are to be protected.

[vijayakumar T D]

Respected  Sri  K M Rao,

Thanks for the clarification and it has taken tension out of me.

But is there any possibility of Kotak offering lumpsum amount  to existing pensioners, like it is offered under VRS, to opt out of
pension scheme and indirectly threatening us about non payment of pension in future,  which may lead to law suite against financial giant and
other related problems to pensioner.

With warm regards
Vijayakumar

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Date: Sat, 29 Nov 2014 18:21:31 +0530

Subject: Re: bankpensioner REQUEST FOR CLARIFICATION

From: mohand...@gmail.com
To: bankpe...@googlegroups.com

[Rishikesavan Sadhasivan]

The pension fund at ING BANK will be automatically taken /transferredd to kotakbank, It is the duty of Kotak bank to pay the pensio asper PENSIONERS ACT. You need not bother .maybe it will take some time Rishikesavan ib 2001 V R S Sent from Yahoo Mail on Android

From:"R Krishnan" <kan...@gmail.com> Date:Sun, 30 Nov, 2014 at 13:46 Subject:FW: bankpensioner REQUEST FOR CLARIFICATION

[PM]

Dear Mr Vijayakumar,

                                      Need not worry much on this aspect.Future Pension payment by Kotak Mahindra bank is not an individual affair pertaining to you only  where as it is applicable to all pensioners of merged bank.You will get monthly pension after merger of your bank -ING Vysya Bank with Kotak Mahindra Bank.Employees Association as well as Retirees association in your Bank will assist and sort out the issues if any in future also.

                                      There is no provision for Lump Sum payment of Pension as per Bank Employees Pension Regulations 1995 approved by Board of each banks.VRS is a different subject and need not link the scheme with pension payment to create confusion.

Please understand the reality first:

01. The Board of Directors of Kotak Mahindra Bank Ltd  and the Board of Directors of ING Vysya Bank Ltd  at their respective meetings held on 20th November'14,t have approved an all-stock amalgamation of ING Vysya with Kotak. 

02.The amalgamation is subject to the approval of the shareholders of Kotak and ING Vysya respectively, Reserve Bank of India under the Banking Regulation Act, the Competition Commission of India and such other regulatory approvals as may be required.

03.Upon obtaining all approvals, when the merger becomes effective, ING Vysya will merge with Kotak.Shareholders of ING Vysya will receive shares of Kotak in exchange of shares in ING Vysya at the approved share exchange  ratio. All shareholders of Kotak and ING Vysya will participate thereafter in the (merged) Kotak business.

04.  All ING Vysya branches and employees will become Kotak branches and employees.

ING Vysya’s CEO designate, Mr Uday Sareen, will be inducted into the top management of Kotak reporting directly to Mr Uday Kotak, Executive Vice Chairman and Managing Director of Kotak.

05.Merger terms

The Boards of Kotak and ING Vysya respectively considered the results of a due diligence review covering areas such as advances, investments, deposits, properties & branches, liabilities, material contracts etc.This will include the Pension Fund of ING Vysya Bank too.

06.As per discussion paper on merger released  by Kotak bank it is stated that merged entity will have about 30000 employees ie.10000 from ING Vysya Bank and 18000 from Kotak Bank.Out of which about 3000 belongs to old generation bank with member ship in unions.and specific mention on such employees is also found place in the above paper.On  a technical clarification  on fate of  these 3,000 employees under IBA wage negotiations it is found clarified that Kotak Bank will  respect all the current arrangements and  will embrace them on the same basis and it is finally the option of each employee to do what they think is right.

So also on another question on matters like  defined benefit, pension scheme kotak bank's reply is that  nothing changes from their point of view unless any of the employees want to make a change.

Still you have any doubt kindly contact your bank retiree association.