Three dozen recommended for CIP honour

Some three dozen entrepreneurs and business organisations have been recommended for the Commercially Important Person (CIP) honour for their contribution to the economy and commercial sector.

The list of 35 foreign and national exporters, importers, investors, employers and entrepreneurs has been selected on the basis of transactions made in the last two fiscal years 2010-11 and 2011-12.

The honour — that includes VIP facilities at Tribhuwan International Airport and other privileges — is awarded every two years by the government to encourage entrepreneurs to contribute to the economy.

Nepal Telecom has been recommended for its contribution as the largest tax payer; IME for channelling the highest amount of remittance at Rs 123.11 billion into the country; Sita World Travels for bringing the highest number of tourists from third countries; Hotel Hyatt Regency for earning the largest foreign currency through the tourism sector; largest employer Arihant Multi Fibers; largest investor of manufacturing industry under operation Jagdamba Steel Industries; top two importers of Nepali goods in China — Tibet Yintao Trading Company of Khasa and Shanghai Hengna — two importers of Nepali goods in India — Dabur India and Bhushan Power and Steel — five largest exporters-industrialists — Paramount Carpet Industries, Nepal Fashion, Everest Pashmina Knit & Weaving Industries, Tribeni Dal & Oil Industries and Asian Leather Industries — based on the amount of goods exported to third countries; Aarti Strips and Dabur Nepal as top two exporters-industrialists based on the amount exported to India have been recommended for the honour.

Likewise, presidents of Federation of Nepalese Chambers of Commerce and Industry (FNCCI), Confederation of Nepalese Industries (CNI), and Nepal Chamber of Commerce (NCC) for their contribution in promoting export and commercial sectors; presidents of top three commodities associations — Nepal Carpet Exporters' Association, Garment Association-Nepal (GAN) and Nepal Pashmina Industries Association — for their largest share in third country exports, apart from Federation of Nepalese Handicrafts and Federation of Nepalese Women Entrepreneurs have also been recommended for the CIP honour.

Similarly, five largest importers — Wissenbach GMBH & Co KG, Germany; The Bonton Stores Inc, USA; Lentils-Rokeya, Bangladesh; Oto Gmbh, Germany and Derma SRL, Italy — of Nepali goods in third countries based on the amount of goods exported have also been recommended for the honour.

However, the government will not award the CIP to any person or business blacklisted by any of the government authorities; blacklisted by Credit Information Bureau (CIB) as a defaulter of any bank or financial institution; of bad moral and convicted by the court; convicted of corruption and financial irregularities and tax defaulter till the previous year, at the time of awarding the CIP.

Global IME Bank gets fifth partner Gulmi Bikas Bank to merge with

Global IME Bank is planning another merger with Gulmi Bikas Bank.
The class ‘A’ financial institution signed a memorandum of understanding (MoU) with class 'B' Gulmi Bikas Bank today after their initial understanding two weeks back.

Formed after the merger of Global Bank, IME Financial Institution and Lord Buddha Finance, the Global IME Bank has been currently in an acquition process with Social Development Bank too. Gulmi Bikas Bank will be the fifth entity is has been acquiring. Though the central bank has not brought Acquisition law, the banks and financial institutions have been following the Merger law for acquisition too.

Global IME Bank that has a paid up capital of Rs 2.25 billion will increase its paid up capital to Rs 2.50 billion after the merger with Gulmi Bikas Bank, excluding Social Development Bank that has a paid up capital of Rs 25 million.

Gulmi Bikas Bank with its listed 250,000 units of ordinary shares at Nepse was trading at Rs 141 per unit share before being suspended for the time being due to the merger process.

NIC Bank, Bank of Asia Nepal to merge

The domestic financial sector will witness a merger between two commercial banks for the first time with the merger of NIC Bank and Bank of Asia Nepal (BoAN).
NIC Bank and BoAN signed a memorandum of understanding today for the proposd merger which is expected to be concluded by mid-January 2013. "Both the banks had been looking for a partner to merge with in both international and domestic banks but talks did not lead anywhere," said chief executive of NIC Bank Sashin Joshi.
He stressed that after the merger, the merged entity will be one of the largest commercial banks with the highest capital base exceeding Rs 5 billion. "This is first time that any two strong class 'A' financial institutions are going to merge, and the increased capital base will allow the bank to finance large projects on its own," he added.
The banks will apply for a Letter of Intent (LoI) at Nepal Rastra Bank (NRB) and after obtaining the LoI they will conduct Due Diligence Audit that will determine the share swap ratio between the banks.
The banks have yet to decide on the name after the merger. After the merger, the bank will have 65 branches and 69 ATMs with 36 branches of NIC and 37 branches of BoAN in operation.
Likewise, its customer base will exceed 225,000 with total deposits of Rs 34 billion and loans worth Rs 28 billion. "The merged bank will have about 90,000 shareholders and 800 employees," according to Joshi. "The bank will strive to retain all its employees as the expansion of the bank will require more manpower," he added.
The banks have already corresponded with Nepal Stock Exchange to halt trading to avoid any manipulation of share prices. NIC's shares were traded at Rs 486 and BoAN shares were traded at Rs 237 at the stock exchange today. BoAN earned a profit of Rs 117 million and NIC earned Rs 263 million by the third quarter of the current fiscal year.
Since the last couple of years, NRB has been encouraging financial institutions to consolidate as the Nepali financial system is not large enough to allow space for more than 200 financial institutions to conduct business without stepping on each other's toes. Due to the central bank's insistence on mergers, there are more than 26 financial institutions that have formally applied for an approval to merge from NRB.
The central bank has already given LoI to eight sets of financial institutions with six more to go. Most of the financial institutions seeking mergers belong to class 'C' and 'B' categories. Among the commercial banks, Machchhapuchhre Bank is opting for a merger with Standard Finance, and Global Bank's merger with IME Financial Institution and Lord Buddha Finance is almost complete.

Global IME Bank to start soon
KATHMANDU: The merged entity of Global Bank, IME Financial Institution and Lord Buddha Finance will start operations as Global IME Bank from July 9, according to the bank. After the merger, the bank will have a paid-up capital of around Rs 2.20 billion and will be able to fulfill the central bank's regulation. The merger was granted final approval last week. The bank and IME Financial Institution being promoted by IME Group was asked by the central bank to opt for a merger as it will be easier and send a positive message in the market.

Consensus key to budget: NC chief Koirala

The government cannot even bring the 'special budget' without political consensus, forget about the full-fledged one," according to Nepali Congress president Shushil Koirala said.
"The political consensus will help bring the special budget for the regular expenses," he said, adding that Nepali Congress (NC) understands that the country should not be victimised for the 'ego' of political parties but there is no option to the political consensus before bringing the budget.
After the discussion with the private sector today at his residence, Koirala said that the NC has already started consultation with the political parties to find a common ground. "The private sector should also help convince 'other political parties' to forge consensus," he told the entrepreneurs.
"The government led by UCPN-Maoist is planning to bring full-fledged budget ignoring the two largest political parties NC and CPN-UML," Koirala said, adding that it is unacceptable.
The team of Federation of Nepalese Chambers of Commerce and Industry (FNCCI) led by president Suraj Vaidya told Koirala that the political consensus is a must but the country should not be victimised due to the political tug-of-war. "Let the politics take its course, we do not interfere in it but the economic agenda should also be addressed," he said, requesting the NC chief to forge political consensus soon.
The private sector is ready to help political parties forge consensus that could pave the way to full-fledged budget, he said. "We have even prepared and shared the common minimum economic agenda — that will help the political parties come to a meeting point on economic issues — with political parties."
However, the lingering uncertainty has been hitting the economy hard and the country is suffering, said Vaidya, who led the entrepreneurs’ team that included former FNCCI president Chandi Raj Dhakal, incumbent vice-presidents Pashupati Muraraka and Bhaskarraj Raj Karnikar, chairman of IME Group Chandra Dhakal, hotelier B K Shrestha, and entrepreneur Diwakar Golchha.
At a time, when there is only two weeks for the budget, the private sector has been actively involved in consultation with the political parties and urging them to forge consensus to bring the full-fledged budget. The government must bring the budget — either special or full-fledged — before the fiscal year ends on July 15 through ordinance as there is no parliament.
Similarly, the FNCCI team — in the meeting with the caretaker prime minister Dr Baburam Bhattarai today morning at his official residence — also shared the common minimum economic agenda and asked him to agree on it.
The government should agree on FNCCI-prescribed common minimum economic agenda to let the country move forward, Vaidya suggested the premier.
"The government should end the current political impasse and create investment-friendly environment," he said, adding that the political uncertainty has hit the economy. "Without economic growth and stability, the political stability is not possible," he added.
The government needs to create a separate mechanism that could look after economic agendas despite the change in guard of governments," Dr Bhattarai said, consoling the entrepreneurs that the budget will come on time.