N24 Staff Writer, KATHMANDU:- Nepal’s largest financial institution Himalayan and Investment Bank have reached an agreement for the merger. Initially, the Asset and Liability Assessment (DDA) has been completed. Both sides are positive about the initial DDA report.
Once the DDA is completed, there will be a Memorandum of Understanding (MoU) for the merger. Chairman of the Investment Bank Prithvi Bahadur Pandey said that both parties were positive about the merger.
“No matter how much work is being done so far for the merger, it is moving in a positive direction,” Pandey told media. “You will get good news in a few days.”
Both banks are good in many financial indicators. There is not much difference in the ordinary share price of both. According to sources, the swap ratio is likely to be equal to 1.
This means that whichever of the two banks has the same share, the investor will get the same share of the bank after the merger. Documentation for the MoU has now begun.
Himalayan-Investment Bank will be the largest after Rs. 25 billion Adjusting for the second quarter financial statements of both the banks, the paid-up capital will be around Rs 25 billion, which is higher than the current commercial banks.
Similarly, the credit flow will be two and a half trillion rupees and the deposit collection will be three trillion rupees. The size of the reserve fund reaches 16.26 billion.
The merger of the two banks has also eased their family ties.
Himalayan Shamsher Rana established Himalayan Bank. He is now on the board of directors of the bank. His son Ashok Shamsher is the CEO of Rana Bank.
Meanwhile, Investment Bank Chairman Prithvi Bahadur Pandey is the son-in-law of Himalaya Shamsher. NRB has been urging these banks to merge with each other due to family ties.
Monetary policy has put pressure on these banks to merge.
“Arrangements will be made for the merger of banks and financial institutions promoted by the same person-group and directly-indirectly owned-controlled by a single-family and business group and established business relations,” the monetary policy said.
Both Pandey and Jabra’s family companies own shares in the bank.
Shadow International owns an 8.89 percent stake in Himalayan Bank. Pandey, the chairman of Shadow Investment, has a family investment. The bank is 11.38 percent owned by Abha International. Himalayan Shamsher Rana has invested in Abha.
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