In a statement, the association said the move to convert 14 zonal offices to five local head offices would only increase the cost of functioning and harm the prospect of a sustained turnaround for UCO Bank. "The bank management's plea that the exercise entails cost effectiveness, decentralisation of administrative powers, increase in operational efficiencies, delayering of tiers is far from reality," the association's Delhi unit said.

Requesting that the restructuring be put on hold, it said the cost of acquisition and initial expenses for establishing the five local head offices would also add to the bank's cost when it has targeted a net profit."This exercise will certainly prove to be suicidal for the bank as this is not the appropriate time toswitch over to a new structure from the already established system," it said. Any such adventurism would be unbearable for the bank till it can achieve the wanted turnaround, it said asking the management to postpone the restructure.

Earlier, UCO Bank dismissed protests over the management's decision to eliminate zonal offices, pointing out that all its six unions had agreed to the decision to scrap one of the four tiers of its administrative setup. UCO chairman and managing director Sharda Singh said the six unions were signatories to a May 1997 memorandum of understanding with the management.

Singh said the bank's board gave its seal of approval in April this year, following which the All-India UCO Bank Officers Federation had voiced its protest.

Singh said the 1997 MoU had stated explicitly that the restructuring process would start with the merger of divisional and zonal officers wherever they co-existed. Based on the reports of several agencies which recommended a 3-tier set-up by abolishing thezonal office, the board finally gave its clearance for setting up five operating head offices under the overall control of general managers.

The unions released a note protesting the "bank's deliberate attempt to make the officer director a party to the ill-conceived restructuring of bank's administrative set-up". Reacting to this, Singh said the union's argument did not hold as it was aware of the restructuring move when it signed the MoU in 1997.He allayed fears expressed by some employees that the restructuring would lead to disintegration of the bank and hasten the process of merger. He added that even the MS Verma panel on revival of weak banks had gone on record that it is against mergers.