Wednesday, November 24, 2010

Civil Bank to come into operation from Friday

Civil Bank Ltd is starting its operations from Friday.
"We are soft-launching on Friday," said Kishore Maharjan, chief executive officer (CEO) of the 30th commercial bank of the country. "We got the operational licence last Friday," he added.
The youngest commercial bank has 147 promoters — mostly from the housing business with Rs 2 billion authorised capital.
The bank has Ichchha Raj tamang, as the chairma in board.
Civil Bank is the 12th company of Civil Group — a renowned name in the housing business -- that also has Civil Merchant Bittiya Sanstha and Civil Savings and Credit Cooperative.
The promoters have 60 per cent of the paid up capital, whereas the bank is planning to float 40 per cent to the public making it the largest ever initial public offering (IPO). "The bank will float Rs 800 million worth share to the public," he said, adding the the promoters have already paid Rs 1.20 billion.
According to the regulation, a commercial bank must have Rs 2 billion paid up capital and have to float 30 per cent share -- of the paid up capital -- to the public.
Though the central bank has temporarily halted the licencing of the new commercial banks, there are a couple of commercial banks -- Century Commercial Bank and Business Bank -- still in pipeline apart from some of the national development banks planning to upgrade to the Class A commercial bank.
The central bank has temporarily stopped the registration of new financial institutions — including commercial banks, development banks and finance companies — in August 2009 saying that the existing number of commercial banks in a small economy like Nepal was already more than enough.
According to the central bank’s data, 30 commercial banks -- inlcuding Civil Bank, 80 development banks, 79 finance companies, 18 microfinance institutions, 16 NRB-licenced cooperative, and 45 NRB-licenced NGOs.
Commerz and Trust Bank Nepal is the 29th commercial bank.
"Besides the establishment of new banks and financial institutions, the branch expansion of commercial banks also took place significantly in the fiscal year 2009-10," according to the central bank's annual report. "Commercial bank branches increased by 214 to 966 in mid-July 2010 from 752 in mid-July 2009," it said, adding that branches of development banks and finance companies stands at 358 and 265, respectively by the end of the last fiscal year.

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