The 78th meeting of the committee held Wednesday took the decision. [break]
A sub-committee led by Hari Roka had recommended the government to reduce its stake in the ADBL by 30 percentage points from the existing 55.78 percent.
"The meeting today endorsed the ADBL´s capital restructuring plan, as recommended by the sub-committee, and instructed Ministry of Finance (MoF) to submit a proposal to this connection to the cabinet for endorsement," Tanka Mani Sharma, member-secretary of the Privatization Committee, told Republica.
As per the existing capital structure of ADBL, the government has investment worth Rs 1.62 billion in the bank.
Roka, coordinator of the sub-committee, said the meeting has also endorsed the agreement signed between ADBL and Asian Development Bank on loan and grant assistance for organizational restructuring of the state-owned bank.
ADB has agreed to provide $60.4 million as loan and $12.1 million as grant assistance to ADBL.
“We have paved the way for ADBL to divest its share so as to make the bank a competitive commercial bank in the coming days," Rokka said.
Sharma, who is also the chief of the Public Enterprises Coordination Division of MoF, said the meeting also decided to conduct detailed study of the current situation of 26 Public Enterprises (PEs) where the government has partial holdings.
- Govt divests its shares in SFDB
- Reduces its stake in ADBL
- Paves the way to convert NAC into a company
- Round table meeting on privatization within a month
In an effort to expedite the slow moving privatization process, the committee meeting also decided to organize a round table meeting of stakeholders within a month to collect opinions for the privatization of PEs in an appropriate manner.
Sharma said the Finance Ministry informed the meeting about the completion of the process to sell all its stake (16.5 percent share) at Small Farmers´ Development Bank (SFDB) to 205 small farmers co-operatives.
“A total of 200,000 units of shares worth Rs 20 million were divested to small farmers co-operatives. The government now has no stake in the bank,” Sharma added.
The farmers´ co-operatives have purchased shares ranging from 500 to 4,310 units, according to Sharma.
The meeting also endorsed the Prospectus and Regulations submitted by the Ministry of Tourism and Civil Aviation (MoTCA) to convert Nepal Airlines Corporation (NAC) into a public limited company.
This has paved the way for the government to invite strategic partners to revive the ailing national flag carrier.
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