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<h1>Consolidation of public sector banks to achieve scale, risk diversification and enhanced credit capacity while protecting stakeholders.</h1> Consolidation among public sector banks is recommended to secure economies of scale, risk diversification and capacity to finance large credit demands, utilising voluntary mergers under Section 44A and supervisory amalgamation under Section 45 of the Banking Regulation Act; consolidation should be board-led, stakeholder-protected and competition-assessed, with attention to regulatory capital requirements, implementation challenges and alternative consolidation via business specialisation.