Global IME Bank, Commerz and Trust Bank Nepal to start operating as one unit after third quarter

Global IME Bank and Commerz and Trust Bank Nepal today signed the final Memorandum of Understanding for merger.

The merged entity in the name of Global IME Bank will start operating as a single unit after the third quarter, said Global IME Chairman Chandra Prasad Dhakal after signing the memorandum of understanding with chairman of Commerz and Trust Bank Nepal Shovakar Neupane, on behalf of their respective institutions here today.

One of the promoters from the Commerz and Trust Bank Nepal will represent in the board, Dhakal, said, adding that the remaining board members and the chief executive of the current Global IME Bank will continue to serve the institute.

Though, it is the second merger among the two commercial banks after NIC Bank and Bank of Asia Nepal (currently NIC Bank of Asia) lat July, the merger will be the first of its kind in terms of different promoters in two institutions.

By mid-April, the two Class 'A' banks will be completely merged, he added.

Both the commercial banks have scheduled their annual general meetings next month to get their merger proposals endorsed by the shareholders.

Commerz and Trust is holding its AGM on March 3, whereas Global IME has scheduled its AGM for March 5.

The merged entity is planning to publish a single merged third quarterly financial report,” Dhakal added.

The merger will help increase paid up capital that will give us more room for investment in productive sectors and large-scale projects,” Dhakal said.

The merged Global IME Bank will have Rs 4.10 billion paid-up capital.

Global IME Bank had earlier merged with two Class 'C' financial institutions –IME Finance and Lord Buddha Finance – to form Global IME Bank. Later, it merged with Social Development Bank and Gulmi Development Bank too.

After the central bank's initiation, the banks and financial institutions have been taking merger as a safe landing due to shrinking market size and and also to reduce operating cost.

The central bank had issued Merger Bylaws in May 2011 to facilitate the mergers, though it is planning to bring Acquisition Bylaw soon.

Currently, some 43 banks and financial institutions are planning mergers to become 18 institutions. Likewise, some 23 banks and financial institutions have taken Letter of Intent (LoI) from the central bank to merge.

Global IME calls special AGM to finalise merger with Commerz and Trust

Global IME Bank has called special annual general meeting on March 4 to endorse the merger with Commerz and Trust Bank Nepal.

The special AGM scheduled to take in Birgunj will endorse the merger with Commerz and Trust Bank by ratifying Due Diligence Audit (DDA) report and finalise the share swap ratio, and convert more than 51 per cent of the bank’s promoter shares into ordinary shares.

The central bank had formally endorsed the merger plan of Global IME Bank and Commerz and Trust Bank, in December.

 The two commercial banks had signed merger agreement on November 10, 2013 and proposed the share swap ration at 100:65.
After the merger between Global IME Bank and Commerz and Trust Bank, it would be the second merger between the commercial banks as the first one was NIC Bank and Bank of Asia Nepal.

Commerz and Trust Bank Nepal to float primary shares from February 17

Commerz and Trust Bank Nepal (CTBN) will issue six million units of primary shares worth Rs 600 million at a face value of Rs 100 per unit from February 17 to February 21.

Of the total, some 300,000 units have been bought by Siddhartha Mutual Fund and Citizens Units, according to the capital market regulation. Likewise, some 300,000 unit shares will be for employees of the bank. The bank will allot the remaining 5,400,000 unit shares to the general public.

"Buying Commerz and Trust Bank's share will be profitable for both short-term and long-term sustainable returns," said chief executive of the bank Anal Raj Bhattarai.

The bank, with 13 branches, has low operating cost, he said, adding that it is planning to add three more branches, one each in Rolpa, Birgunj and Baneshwor of Kathmandu, soon. "It posted a profit of Rs 65 million in the second quarter of the current fiscal year."

CTBN had recently held interactions with potential investors in Birgunj, Biratnagar, Pokhara, Butwal and Dharan to inform them of the bank's primary shares. "We have received overwhelming response from potential investors," Bhattarai added. "They are more aware of the primary issues and bank's financials, which is a good sign for the progress of the capital market."

An investor can apply for a minimum of 50 unit shares and to a maximum of 1,500,000 units, but the bank will distribute shares proportionately on the basis of total amount of applications, according to the new regulation.

Commerz and Trust Bank Nepal, which started operations on September 20, 2010, with a paid up capital of Rs 1.40 billion — as the 29th commercial bank of the country — will have a paid up capital of Rs 2 billion after the shares are issued.

The market will see Mega Bank and Century Commercial Bank's primary issue after Commerz and Trust Bank Nepal that will be listed as the 29th commercial bank at Nepse after its shares are alloted to the public.

Hello Paisa shortlisted for 'Innovator of the Year Award 2012'

Finaccess (Hello Paisa) has been selected as the top three final nominees for the 'Innovator of the Year Award - 2012' by the Swedish International Development Agency (SIDA)'s Innovation Against Poverty (IAP) programme.

The IAP annual conference and awards ceremony will be held on November 26 in Stockholm, Sweden, where the award will be presented to the 'Innovator of the Year' by the director general of SIDA after selection by eminent global panellists.

The nomination is a recognition by SIDA and Innovation Against Poverty of Finaccess’s efforts towards providing innovative business solutions to bring financial access to the underserved and unserved segments of the population across Nepal, said executive chairman of Finaccess Sanjay Bahadur Shah.

The shared access of Hello Paisa eco-system and interoperability of customers, banks, mobile operators, and agents is a key feature that enables all segments of the population access to state-of-the-art mobile financial services, according to him.

Finaccess is a technology empowered financial services company as it offers two main services – mobile financial services through its proprietary software Cell or and its shared access and totally interoperable Hello Paisa platform and financial inclusion services by expanding and setting up of the eco-system of agents and merchants required for effective delivery of financial services at the grass roots level.

Currently five banks and financial institutions — Laxmi Bank, Bank of Kathmandu, Siddhartha Bank, Commerz and Trust Bank Nepal, and International Leasing and Finance Company — use the Hello Paisa network. This initial network of five banks and financial institutions already has 175 bank branches and 125 agent touch points for delivering services. The agent network is expected to increase substantially within the next few months and be able to deliver financial services to all corners of the country.

Nimbus, Finaccess join hands to offer mobile financial services

Nimbus Holdings and Finaccess entered into an agreement today to enable various businesses of Nimbus with a ubiquitous distribution network throughout the country — specifically in the rural parts and comprising of over 500 dealers and sub dealers — to offer an end to end mobile financial service provided through the Hello Paisa Network.
"The agreement will enable the dealers and sub dealers of Nimbus Holdings to act as Hello Paisa Operators or Agents," said managing director of Nimbus Holdings Anand Bagaria after signing the Memorandum of Understanding (MoU) with executive chairman of Finaccess Sanjay Bahadur Shah on behalf of their respective institutions.
Finaccess operates and manages Nepal’s first and only shared access 'Hello Paisa' Mobile Financial Services platform that enables banks and financial institutions launch interoperable Mobile Financial Services, which will enable the banks and financial institutions provide 'Access to Finance for All' through Mobile Banking using the Hello Paisa Platform, consistent with central bank's policy of taking financial services to nook and corners of the country.
There are currently five banks and financial institutions — Laxmi Bank, Bank of Kathmandu, Siddhartha Bank, Commerz and Trust Bank Nepal and International Leasing and Finance Company — as partner institutions within the Hello Paisa network, according to Shah. "Current and future customers of all the banks and financial institutions and more in pipeline will be able to transact among each other seamlessly."
The strategic partnership will entail the distribution network of Nimbus to become Hello Paisa Operators (Agents) acting as the customer touch points (branchless banking outlets) on behalf of a specific banks or multiple banks with in the Hello Paisa Network.
The partnership will work in a tripartite conjunction between Nimbus, Hello Paisa and a specific bank or multiple banks within the Hello Paisa Network where by the alliance will focus on enabling financial transactions through the Hello Paisa Operators with a target of 500+outlets across the country by the end of the current fiscal year.
Considering the tremendous challenges and enabling access to finance for all, using alternative delivery channels like mobile banking and branchless banking is going to be a very important step towards enabling access to financial services to serve the underserved and unbanked communities.
The key to expedite the business model is the development of a network and eco system with participation of existing businesses with developed distribution networks. As the Nimbus distribution is already serving the customers in rural parts, it is an important strategic fit for Nimbus to further enable financial services to the rural and agricultural activity based customers that Nimbus dealership interacts with on a daily basis, according to them.