Chennai, Apr 8 (IANS): Citing the Rs 30,000 crore public deposits in Lakshmi Vilas Bank (LVB), the All India Bank Employees' Association (AIBEA) has demanded its merger with a public sector bank (PSU) than be acquired by Indiabulls Housing Finance Ltd (IBH).

In a letter to the Governor of Reserve Bank of India (RBI) on Sunday, AIBEA General Secretary C.H. Venkatachalam said: "Taking into account the fragile health of Lakshmi Vilas Bank Ltd., it is necessary for the RBI to take a holistic view and merge it with one of the public sector banks in public interest instead of allowing LVB to merge with IBH."

"The Bank may be a private bank but the deposits in the bank (Rs 30,000 crore) belongs to the people at large and is public money," he added.

Venkatachalam said, it is already known that IBH had applied for banking licence to start a Bank on its own but the same was not sanctioned by the RBI.

"Having failed to get a banking licence, it is now found that IBH is trying to become a bank by merging LVB with itself. This is obviously a short-circuit method by IBH," he said.