KATHMANDU, May 13: Himalayan Bank Limited (HBL) and Nepal Investment Bank Limited (NIBL) on Thursday signed a memorandum of understanding for merger, agreeing to name the merged entity as ‘Himalayan and Nepal Investment Bank Limited.’
HBL’s Chairman Tulasi Prasad Gautam and NIBL’s Chairman Prithvi Bahadur Pande inked the agreement to this effect, with completing the merging process in the next two months. Both the banks have agreed to maintain the swap ratio at 1:1 to go into merger.
As envisioned by Nepal Rastra Bank to take the large financial institutions into unification, this is the third biggest merger between commercial banks in Nepal. Previous to this, NIC and Bank of Asia and Global IME Bank and Janata Bank merged to operate as a single bank.
The merged entity will have a paid-up capital of Rs 24.92 billion and capital fund of Rs 46 billion. Similarly, the total deposits will be Rs 311 billion whereas the loan amount will be around Rs 288 billion.
NIBL Chairman Pande will chair the unified bank and Ashoke Rana, who is currently the chief executive officer of the HBL, will hold the position of the CEO of the unified bank. Jyoti Pandey, the present CEO of the NIBL will be placed as deputy CEO of the merged bank.
The board of directors in the integrated bank will have seven members including three from each of existing HBL and NIBL and one elected from the general shareholders. It will have 2,500 employees in total.
Currently, Rastriya Beema Samiti, Mahalaxmi Investment and Chhaya Investment are the major investors in NIBL while Habib Bank (Pakistan), Employees Provident Fund (EPF) and Aabha International are the top investors in HBL.