"While according approval to the scheme of amalgamation of two banking companies, Board of Directors need to give careful and particular consideration in respect of certain matters." Discuss briefly as per Reserve Bank o

While according approval to the scheme of amalgamation to two banking companies, Board of Director need to give careful and particular consideration of following matters: The value at which the assets, liabilities and the reverse of the amalgamated company are proposed to be incorporated in the books of the amalgamating banking company and whether such incorporation will result in a revaluation at assets upwards or credit being taken for unrealized gains. Ensure due diligence of the amalgamating companies The nature of the consideration, which, the amalgamating banking company will pay to the shareholders of the amalgamated company. Whether the swap ratio has been determined by independent values having required competence and experience and whether in the opinion of the Board such swap ratio is fair and proper. The shareholder pattern in the two banking companies and whether as a result of the amalgamation and swap ratio the shareholding of any individual, entity or group in the amalgamating banking company will not be violation of the Reserve Bank guidelines or require it specific approval. The impact of the amalgamation on the profitability and the capital adequacy ratio of the amalgamating banking company. The changes which are proposed to be made in the composition of the board of directors of the amalgamating banking company, consequent upon the amalgamation and whether the resultant composition of the Board will be in conformity with the Reserve Bank guidelines and shall be submitted to RBI for sanction.