Guwahati, Jan. 13: In a bid to give a new lease of life to four regional rural banks of Assam and instil confidence in their depositors, the Centre yesterday amalgamated them into one unit christened theAssam Gramin Vikas Bank.

The merger makes the new bank the largest in the state with 354 branches against the SBI?s 218. It will have an initial business of Rs 2,500 crore.

A function will be held here on Monday to herald the amalgamation, which was notified by the finance ministry yesterday.

The banks being amalgamated are Pragjyotish Gaonlia Bank, Lakhimi Gaonlia Bank, Cachar Gramin Bank and Subansiri Gaonlia Bank.

The area of operation of the new bank shall be the combined area of the existing regional rural banks, covering 25 of the 27 districts of Assam.

The ministry?s notification stated that the Centre decided in favour of the amalgamation after consulting the National Bank for Agricultural and Rural Development (Nabard), the Assam government and the United Bank of India.

It also stated that all employees of the earlier regional rural banks shall continue to serve in the new bank at the same remuneration and on the same terms and conditions of service which they were getting.

Officer on special duty of the Assam Gramin Vikas Bank G.C. Sharma described the merger as the first step towards amalgamation with a bigger bank.

?This will increase our discretionary powers in terms of issuing loans and also our financial strength,? he added.

A senior bank official said the step would give the regional rural bank more exposure, financial strength and help develop the state?s economy.