Friday, January 14, 2022

Himalayan Bank's AGM rejects merger plan with Nepal Investment Bank

 The annual general meeting of the Himalayan Bank Ltd (HBL) rejected the planned merger between HBL and Nepal Investment Bank Ltd (NIBL), after 10 months.

"The 29th annual general meeting of the bank today rejected the planned merger with Nepal Investment Bank,” confirmed Himalayan Bank chief executive officer Ashoke Rana. "So the merger plan with Nepal Investment Bank has officially ended as of now."

The failure of the merger proposal will, however, hurt the investors as the bank cannot distribute dividends and also cannot expand their networks to increase business. The proposal of merger failed in the AGM as the Employees Provident Fund (EPF) and a group led by Manoj Bahadur Shrestha refused to endorse it. The EPF and Shrestha’s group totals some 36 per cent share in the bank.

Shrestha is a former chairman of Himalayan Bank, and EPF -- the government body -- is the institutional promoter. The central bank, has however, clarified that the banks will not be able to distribute the dividends as a fine for 'the demerger'. 

The two commercial banks had signed a memorandum of understanding (MoU) for the merger last May, committing to completing the merger within two months. But the group led by Shrestha was not happy with the proposal.

"The EPF conducted a separate due diligence audit (DDA) of both the banks after the new government was formed in July, even though the merger committee had already conducted DDA,” according to an investor. "The EPF also rejected the merger plan in view of losses projected for it on the basis of the DDA it has conducted."

The merger committee had agreed to seek approval from the AGM for the merger with Nepal Investment Bank on the basis of 1:1 share swap ratio.

The AGM of Nepal Investment Bank Ltd is scheduled for January 18. Howeverm it also needs have a second thought after the rejection from the Himalayn Bank's annual general meeting. Nepal Investment Bank Ltd that feels betrayed by the new development has called emergency meeting of the board of the bank for Sunday.

The central bank -- that is encouraging the mergers -- had extended the deadline for the completion of merger after they wrote an official letter of intent for merger last June.

The merger of the two big commercial banks has been expected to set a precedent for big mergers in future as thed central bank wanted to reduce the number of banks and financial institutions (BFIs) through 'big mergers' enabling the single bank to invest in large infrastructure projects.

Currently, there are 27 commercial banks in Nepal. The number came down as some of the BFIs have already merged.

Himalayan Bank had decided to pass the merger proposal through voting following differences over the  merger between its promoters. According to the voting result some 42 per cent of the votes came in against the merger proposal following objections expressed by the EPF, N Trading Company and Chhaya International. In order to pass the merger proposal, some 75 per cent shareholders had to approve it.

Himalayan Bank has 14.87 per cent share investment of the EPF, where N Trading Company has 12.77 per cent and Chhaya International has 8.94 per cent stake in the bank. Likewise, Habib Bank of Pakistan has a 20 per cent stake in the bank. It is the largest shareholder in the bank, followed by the EPF.

The board of directors of Himalayan Bank had been divided since the merger agreement was signed with the NIBL. Founding promoters Habib Bank, Mutual Trading Company, Aabha International and Khetan Group are in favour of the merger where EPF, N Trading Company and Chaaya International were against the merger. 

Following the agreement, both the institutions had formally informed the regulatory authority central bank, Nepal Stock Exchange (Nepse), Office of the Company Registrar and Securities Board of Nepal (Sebon) about the merger agreement. Moreover, shares of both the institutions had been been suspended until the integrated transaction is completed. The two institutions had planned to start joint operation from last October 1, last year.

Himalayan Bank Ltd --- established in 1993 in a joint venture with Habib Bank Ltd of Pakistan -- was established by Prithvi Bahadur Pandey, who is currently the chairman of Nepal Investment Bank Ltd. 

Nepal Investment Bank Ltd, earlier Nepal Indosuez Bank Ltd, was established in 1986 as a joint venture between Nepali and French partners. But in 2002, a group of Nepali companies, comprising bankers, professionals, industrialists and businessmen acquired the 50 per cent stakes of the French partner, Credit Agricole Indosuez in Nepal Indosuez Bank, and accordingly the name of the Bank was changed to Nepal Investment Bank Ltd.


Arvindsmartspace said...

The spacious Luxury Villas in ahmedabad are equipped with double height living rooms along with the option to upgrade to a personal swimming pool, gym, Disney themed kids’ bedroom as well as.Do visit our website

propertytrands said...

Thanks for sharing wonderful post! If your dream to invest in top real estate projects 2022. You can choose in this projects.

1-ATS Pious Orchards is one of the top pojects in Noida sector 150 that offers 3 and 4 BHK apartment.

2-DLF One Midtown Delhi is also one of the top projects in Delhi NCR that offers 1/2/3 BHK flats.

3-Smart World Orchard is a pre-launch residential projects in sector 61 Gurgaon that offers 2.5 and 3 BHK Apartment.

4-Godrej Riviera Kalyan offers 1 & 2 BHK luxury apartment for sale in ambivali, Mumbai.

5-Godrej Park Retreat Bangalore presents 2/3/4 BHK classy flats with the best feature.

Unknown said...

printing processes generally follow a defined sequence,this is the best place to buy counterfeit money also offering the customer an array of integration options.
Best counterfeit money maker
Best counterfeit money maker we ensure a discrete deal ,top quality Grade AAA because your security is all that matters to us.
Counterfeit money printer for sale
We print our money and make sure we add all top security features real money will have:Standing out Counterfeit money printer for sale.
Counterfeit money for sale
We print and promote the very best quality Counterfeit money for sale undetectable counterfeit 100 USD dollar banknotes.
Fake money for sale
obtain fake money that looks genuine, invests in high-quality fake money, undetectable fake money for sale.

Contact Us
Contact us: (716) 934-8890
Call: (716) 934-8890
Whatsapp:(716) 934-8890

ATS Destinaire said...

ATS Destinaire is one of the best residential projects and has been started by none other than the famous ATS Group.

ithum73 noida said...

Regardless of whether you wish for a local area climate where you might work in amicability or want a solid climate for your business; ithum73noida is the ideal location.

Rahul said...

This is the very good blog when I was read I'll get the good amount of Information about the property.
For other relevant property you can also check out the below mention

2 bhk in dadar

Rohan said...

This is a very useful blog to get proper info about the relevant properties.
you can also check out the 2 bhk in dadar this property as well.

Vedant said...

Thanks for sharing good information about investment. This blog is very good written.
If want to know more about other products visit below mentioned.
flats in chennai

Zoya said...

This content is written very well. Your use of formatting when making your points makes your observations very clear and easy to understand. Thank you.
Trident Embassy Reso is a newly launch luxurious residential property with world class amenities.

Supertech Limited said...

Thanks for sharing Very helpful information. Supertech Limited offers Luxury Residences in Sector 79 Gurgaon with world class amenities and features.

Anonymous said...

This content is written very well. Your use of formatting when making your points makes your observations very clear and easy to understand. Birla Estates Birla Estates Private Limited is an India based real estate company.

Anonymous said...

Great blog. It's very interesting and impressive and also useful information. I have some useful information about DLF One MidTown Delhi
also have info about some other projects like Smart World Gems
Godrej Sky greens

Anonymous said...

It's very interesting and impressive and also useful information. Best Residential/Commercial Property In India
Top Residential Property
Real Estate Project
Real Estate Project In India
Residential Project
Best Residential Project
Luxurious Apartments In India
Premium Apartments In India

Anonymous said...

Great publish, very informative. It's very interesting and impressive and also useful information. I have some useful information about
Premium Housing Projects In India - Real Estate Project

Suraj Estate said...

Thanks for sharing such informative blog. You have provide detail content. keep prociding such Quality content. You can also check Premium 3 Bhk in Dadar
at Suraj Palette

Anonymous said...

The details on this blog are very impressive. Great Publish
Apex Alphabet
SKA Divya Towers
Irish Pearls
ATS Destinaire
M3M Capital Gurgaon
Smart World Gems
Smart World Orchard
Hero Homes Gurgaon

Anonymous said...

Great job on this info. I also have info about Real estate that is an imperishable asset, ever increasing in value.
Top Apartments In Noida
Invest In Residential Property
Luxurious Architecture In Greater Noida West
Modern Living Lifestyle In Greater Noida West
Investment In Real Estate
Real Estate Reality
Luxury Apartments
Investing In Commercial Property
Property In Real Estate Sector
Top Locality In Gurgaon

Anonymous said...

Hi Guys

This is the so much inforamative blog, I Got the lots of information about the other properties.
You can also checkout this
Properties in Mumbai

Anonymous said...

Hi Guys

I read this blog and I love it. This blog is so much informative,I got wonderful information about the real estate projects.
You can also check the other content to visit on flats in chennai