The Reserve Bank of India (RBI) on Thursday came out with a master direction for merger of private sector banks and also mergers between non-banking finance companies (NBFCs) and banks. In another master direction, a compilation which consolidates instructions on rules and regulations framed by RBI under various Acts, including banking issues and foreign exchange transactions, the central bank provided direction for issue and pricing of shares by private sector banks. The scope of master direction on mergers will cover “an amalgamation of two banking companies and amalgamation of an NBFC with a banking company”. In both the cases, the voluntary amalgamation will become effective after RBI's approval. According to the direction, the decision of amalgamation should be approved by respective boards by two-thirds majority and not just by members present and voting. Also the draft scheme of amalgamation should have approval of shareholders of each banking company by a resolu