When contacted, IndusInd Bank promoter Ashok Hinduja said: "The bank is in talks with two or three Indian players for a possible merger. The time is ripe for creating value-addition for shareholders, and mergers and consolidation are the way out for the banking industry." Hinduja, however, did not confirm talks with Centurion Bank for a possible merger.

IndusInd Bank managing director KR Maheshwari declined to comment on the issue. Centurion Bank's promoter, Dev Ahuja, and managing director VS Srinivasan are out of the country and were not available for comment. Ahuja's son, Vikram Ahuja, denied merger talks with other banks.

Industry sources, however, said: "Centurion Bank has been on the lookout for merger with another bank. They have also approached a few merchant bankers for initiating talks with possible suitors."

IndusInd Bank has 27 branches and an ATM network of 26, along with four extension counters. The net worth of the bank was Rs 533.29 crore for the year ended March 31, 2000. Total deposits were Rs 6,545.96 crore and advances Rs 3,677.05 crore as on March 31, 2000. The bank clocked a net profit of Rs 56.09 crore during the fiscal 1999-2000.

Centurion Bank has 35 branches, 25 marketing offices, and 41 ATM centres. The bank's net worth is Rs 226.06 crore. It recorded a net profit of Rs 34.34 crore during the year ended March 31, 2000. Total deposits were Rs 3,867 crore, while advances, including credit substitutes, were Rs 2,643 crore during 1999-2000.

The Centurion Bank scrip ended on Monday at Rs 17, while the IndusInd Bank share closed at Rs 29.60 on the Bombay Stock Exchange (BSE).

This is the second time that Centurion Bank is holding merger talks with another bank. The new-generation private-sector bank had in December last year initiated a dialogue with ICICI Bank for a possible merger. However, after negotiations that ran over a month, ICICI Bank shelved the plan to take over Centurion following differences between the two over the swap ratio.