37-year old, Shree Suvarna Sahakari Bank Limited, an Urban Cooperative Bank (UCB) based in Pune was merged with Indian Overseas Bank (IOB) after the approval from RBI and Registrar of Companies (RoC) of Maharashtra Government. It is said to be the first-ever merger of a cooperative bank with a public sector undertaking.

With this merger, the Indian Overseas Bank has got hold of 1.45 lakh accounts of the Suvarna bank. The Suvarna Bank had 12 branches (nine in Pune, two in Mumbai and one in Shripur) all of which will function as IOB entities Wednesday onwards.

G. R. Gandhi, general manager for Mumbai II region of IOB, said, "The bank has completed all the planned work of connecting the accounts of Shree Suvarna co-operative bank to IOB. All the 12 branches are now on par with other IOB branches, and will start functioning from Wednesday."

Gandhi also mentioned, "Till May 19, the deposits of account holders of Suvarna bank's various schemes will get the interest rate mentioned by the cooperative bank. From May 20, the same accounts will get interest as per the banking rates, which will bring all the accounts to the level of other accounts. The 12 branches of the bank have been connected to the core-banking system of the IOB." Gandhi also said that the account holders of Suvarna Bank may be given new account kit which is given to all new customers.

Earlier on September 9, 2006 as per RBI's notification, a moratorium was put on Suvarna bank. The estimated losses and NPAs which account for more than Rs 300 crore are primarily due to connected lending. The bank has deposits amounting more than Rs 700 crore.

Sanjay Kumar Bhosale, administrator, erstwhile Suvarna Bank, confirmed "IOB has completed all the required procedures of merging the bank. it also received necessary permissions from the reserve bank of India. from Wednesday, all depositors, members, account holders of the earlier Suvarna Bank will have access to their accounts and deposits."

As on March 31, 2009, IOB had deposits worth Rs 1 lakh crore, loan advances worth Rs 75,000 crore and 1,75,000 crore annual business. The bank has 1,950 branches across the country. Gandhi said that the bank will speed up recovery of the liabilities and debts, which it took over from Suvarna bank at the time of the merger.