Monday, March 18, 2013

NIC Asia Bank to be operational within this fiscal year

The proposed NIC Asia Bank is expected to come into operations within this fiscal year.
The first merger of two commercial banks — NIC Bank and Bank of Asia Nepal — have been approved by their respective annual general meetings held separately in Biratnagar and Kathmandu today but is subject to the regulator's final approval, which might take a couple of months.
"The integration process of the two banks will start soon after the central bank gives the final approval," said chief executive of NIC Bank Sashin Joshi. "Nepal Rastra Bank — the regulator — had erlier given Letter of Intent (LoI) for the merger of two commercial banks."
The proposed NIC Asia Bank will pave the way for merger between other commercial banks.
The joint merger committee will send today's annual general meetings minutes to the Nepal Rastra Bank within seven days, he added.
The NIC Bank’s 15th AGM held in Biratnagar has approved the merger of Bank of Asia with NIC Bank with a share swap ratio of 2:1, which means existing two shares of Bank of Asia Nepal will be converted to one share in the merged entity. Likewise the fifth AGM of Bank of Asia Nepal in Kathmandu has also approved the proposal today.
The proposed NIC Asia Bank will have an authorised capital of Rs 3.6 billion and paid up capital of Rs 2.31 billion after the merger. Similarly, Jagdish Prasad Agrawal and Sashin Joshi will continue as chairman and chief executive of the proposed NIC Asia Bank as they are currently chairman and chief executive of NIC Bank.
The board of the proposed NIC Asia Bank will have three promoters from NIC Bank, two from Bank of Asia, three from public and one independent expert director.
"The merger will be a historic event in the banking sector in the country as the first merger of two commercial banks," Joshi said, adding that the merged entity — NIC Asia Bank — will be amongst the five largest private sector banks in the country with a balance-sheet size of close to Rs 50 billion and a network of 65 branches and 59 ATMs spread from Mechi in the east to Mahakali in the far west of the country.
Earlier, the boards of both class A commercial banks had already passed the merger and share swap ratio proposal and has forwarded it to the annual general meetings for shareholders approval, according to the listed companies regulation.
Meanwhile, the annual general meeting of NIC bank today also approved a cash dividend of Rs 25 per share from the profits of last fiscal year 2011-12 subject to approval of Nepal Rastra Bank. By the fiscal year-end NIC bank had collected deposit worth Rs 22.1 billion, floated loan worth Rs 17.2 billion and posted profit of Rs 392 million, it added.
Current public directors Rajendra Prasad Aryal and Birendra Kumar Shanghai were also elected unanimously for another term by the NIC Bank annual general meeting today.

Merged Prudential starts operations
KATHMANDU: Prudential Finance has started its operations as a merged finance company between Prudential Finance and Gorkha Finance from Monday. Deputy governor of Nepal Rastra Bank Maha Prasad Adhikari inaugurated the merged entity 'Prudential Finance' in the valley on Monday. The merged finance company has a share capital of Rs 483.1 million, collected Rs 986 million worth deposit and has floated loans worth Rs 930 million, said the chairman of Prudential Finance Manoranjan Raman Sharma. Ajay Kumar Mishra is the chief executive of the merged finance company.

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