KATHMANDU, June 16: Global IME Bank Limited (GIBL) and Bank of Kathmandu (BoK) on Thursday signed a Memorandum of Understanding for merger.
In the last one week, it is the second ‘big’ merger agreement signed between larger banks and financial institutions. Last Friday, Nepal Investment Bank Limited and Mega Bank Nepal Limited inked a memorandum of understanding for merger.
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GIBL and BoK consented to unify by maintaining a swap ratio at the rate of 1:1. GIBL Chairman Chandra Prasad Dhakal and BoK Chairman Prakash Shrestha signed an agreement to this effect.
Following the merger, the new entity to be formed will be named ‘Global IME BoK Limited.’ Ratna Raj Bajracharya, the current CEO of GIBL, will hold the position as the CEO of the merged banks.
The new entity will have a paid-up capital of Rs 34.41 billion, which will be the largest among the capital bases of the commercial banks. Likewise, the reserve fund will reach Rs 17.87 billion.
Meanwhile, Himalayan Bank Limited and Civil Bank are also looking to merge while Century Commercial Bank and Machhapuchchhre Bank have also started necessary work out for their merger.
For the past few years, Nepal Rastra Bank, aiming to reduce the number of commercial banks in the country, has been pressing commercial banks to undergo merger. Although the central bank has been offering various incentives to the merged banks, as of now, very few banks have stepped up for the unification.
