On 25 January 2008, banking operations in the public sector banks across the country were on standstill when its employees struck work as a protest against the suggested merger of seven associate banks of the State Bank of India. The strike call was given by the United Forum of Bank Employees, an umbrella organisation, comprising nine trade union federations.

The union has been opposing the merger of State Bank of India`s associate banks with the parent and the outsourcing of the bank`s jobs. Its other demands include one more option for the existing pension scheme, the filling up of one-and-a-half lakh jobs through fresh recruitment, the restoration of employment on compassionate grounds and the early conclusion of the wage revision due for a long time. According to UFBU sources, around 10 lakh employees stopped work during this strike.

In tune with the first Narasimhmam Committee recommendations of 1991, the government and the bankers were initiating steps to merge public sector banks in an attempt at competing with multinational banks. According to the Committee, the merger of public sector banks will result in the reduction of the number of banks, `right sizing` of branches and staff, which means drastic reduction of the workforce. Besides, in August 2007, the Indian Bank Association had submitted a recommendation requesting the government to reduce the government holding of 51 per cent in the public sector banks to 26 per cent, which obviously meant privatisation of banks. According to UFBU, the merger of public sector banks is just one step ahead of its privatisation move.