KATHMANDU, NEPAL
NIC Bank and the Bank of Asia Nepal (BoAN) have combined to become NIC Asia Bank in the first ever case of a merge r between commercial banks. Nepal Rastra Bank (NRB) governor Yubaraj Khatiwada inaugurated the new entity and gave it his blessings amid a programme held on Sunday.
The two banks, promoted by largely the same group, had signed a memorandum of understanding (MoU) to come together on June 28, 2012. The central bank gave its go-ahead on April 26, 2013. NIC Asia Bank is now headquartered at the Trade Tower at Thapathali.
The merge d bank has joined the league of the top five commercial banks in the country in terms of the size of its balance sheet which is Rs 50 billion. Its total capital base including paid-up capital and reserves come to Rs 5 billion.
Addressing the inaugural ceremony, governor Khatiwada said that the bank now had a challenge to prove that the merge r has been a success. “This merge r has added responsibility to the management of NIC Asia,” Khatiwada said. “The management should be able to set an example by efficiently operating the new entity.”He added that NRB would improve the merge r directives to make it easier for financial institutions to merge . The governor also praised the bank for its success in managing issues related to employees, ownership structure and data transfer and software.
Chief executive officer of NIC Asia Bank Sashin Joshi said that the merge r had added strength to the bank, and this initiative would help to achieve newer heights at a time when the country’s economy isn’t doing so well. He expressed satisfaction that a merge r as big as the one that took place between NIC and the Bank of Asia has been possible through the use of local manpower. “Despite the merge r, there has been no layoffs and the employees from both the banks will be treated equally,” said Joshi.
Following the merge r, BoAN shareholders will be issued new share certificates on the basis of two BoAN shares for one NIC share, according to the bank. Meanwhile, a nine-member board of directors, headed by chairman Jagadish Prasad Agrawal, has also been formed at the merge d entity.
NIC Asia Bank now has 53 branches and a customer base of 270,000. NIC Bank had 36 branches and BoAN had 29. Among them, 13 branches were adjusted and a new corporate entity was added. As for ATM outlets, NIC Asia Bank now has a countrywide network of 57 ATMs. The number of shareholders stands at 90,000. NIC Asia Bank has a total of 630 employees.
The bank’s consolidated operating profit for the first 11 months of the current year to mid-June 2013 stands at Rs 1.43 billion while the net profit stands at Rs 520.96 million. The combined deposit base is Rs 38 billion while loan issue is worth Rs 33 billion.
Banks told to keep ‘reasonable’ spread
Nepal Rastra Bank (NRB) Governor Yubaraj Khatiwada asked bankers on Sunday to keep the spread rate at a reasonable level saying that it was still on the higher side. The spread rate is the difference between the interest rates on deposits and loans.
According to NRB, the spread rate of commercial banks rose to 7.01 percent from 7 percent during the period mid-April to mid-May. The average interest rate on deposits was 5.36 percent while it was 12.37 percent on lending during the review period.
Speaking at the inaugural ceremony of NIC Asia Bank, Khatiwada asked bankers to maintain the spread rate at a level that ensures minimum profits so that industrialists would not suffer. He asked bankers not to expect concessions from NRB for forever for implementing its directives. “Initially, NRB has been giving certain concessions, and it has been implementing the directive effectively after sometime,” he said.
Source: ekantipur,1st July 2013
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NIC Bank and the Bank of Asia Nepal (BoAN) have combined to become NIC Asia Bank in the first ever case of a merge r between commercial banks. Nepal Rastra Bank (NRB) governor Yubaraj Khatiwada inaugurated the new entity and gave it his blessings amid a programme held on Sunday.
The two banks, promoted by largely the same group, had signed a memorandum of understanding (MoU) to come together on June 28, 2012. The central bank gave its go-ahead on April 26, 2013. NIC Asia Bank is now headquartered at the Trade Tower at Thapathali.
The merge d bank has joined the league of the top five commercial banks in the country in terms of the size of its balance sheet which is Rs 50 billion. Its total capital base including paid-up capital and reserves come to Rs 5 billion.
Addressing the inaugural ceremony, governor Khatiwada said that the bank now had a challenge to prove that the merge r has been a success. “This merge r has added responsibility to the management of NIC Asia,” Khatiwada said. “The management should be able to set an example by efficiently operating the new entity.”He added that NRB would improve the merge r directives to make it easier for financial institutions to merge . The governor also praised the bank for its success in managing issues related to employees, ownership structure and data transfer and software.
Chief executive officer of NIC Asia Bank Sashin Joshi said that the merge r had added strength to the bank, and this initiative would help to achieve newer heights at a time when the country’s economy isn’t doing so well. He expressed satisfaction that a merge r as big as the one that took place between NIC and the Bank of Asia has been possible through the use of local manpower. “Despite the merge r, there has been no layoffs and the employees from both the banks will be treated equally,” said Joshi.
Following the merge r, BoAN shareholders will be issued new share certificates on the basis of two BoAN shares for one NIC share, according to the bank. Meanwhile, a nine-member board of directors, headed by chairman Jagadish Prasad Agrawal, has also been formed at the merge d entity.
NIC Asia Bank now has 53 branches and a customer base of 270,000. NIC Bank had 36 branches and BoAN had 29. Among them, 13 branches were adjusted and a new corporate entity was added. As for ATM outlets, NIC Asia Bank now has a countrywide network of 57 ATMs. The number of shareholders stands at 90,000. NIC Asia Bank has a total of 630 employees.
The bank’s consolidated operating profit for the first 11 months of the current year to mid-June 2013 stands at Rs 1.43 billion while the net profit stands at Rs 520.96 million. The combined deposit base is Rs 38 billion while loan issue is worth Rs 33 billion.
Banks told to keep ‘reasonable’ spread
Nepal Rastra Bank (NRB) Governor Yubaraj Khatiwada asked bankers on Sunday to keep the spread rate at a reasonable level saying that it was still on the higher side. The spread rate is the difference between the interest rates on deposits and loans.
According to NRB, the spread rate of commercial banks rose to 7.01 percent from 7 percent during the period mid-April to mid-May. The average interest rate on deposits was 5.36 percent while it was 12.37 percent on lending during the review period.
Speaking at the inaugural ceremony of NIC Asia Bank, Khatiwada asked bankers to maintain the spread rate at a level that ensures minimum profits so that industrialists would not suffer. He asked bankers not to expect concessions from NRB for forever for implementing its directives. “Initially, NRB has been giving certain concessions, and it has been implementing the directive effectively after sometime,” he said.
Source: ekantipur,1st July 2013
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Banks Increase Interest Rates on Institutional Deposits
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