New act on merger and acquisition in offing, says deputy governor

Deputy Governor of Nepal Rastra Bank (NRB), Krishna Bahadur Manandhar has said that Nepal Rastra Bank (NRB) will introduce a new act incorporating enough provisions to facilitate mergers and acquisitions (M&A) of financial intermediaries.

Addressing the closing session of workshop on Mergers and Acquisitions in Financial Sector organized by Independent Business News in Kathmandu on Thursday, Manandhar said that the current number of banks and financial institutions in the country were large, adding, "We need M&A and we encourage it. The capital requirements (for the banks and FIs) have been increased in order to encourage the urge to merge."

He further said, "We expect the M&A will gain the tempo in next two, three years. We do not want legal provisions to be posing obstacle to M&A."

At the programme, PR Somasundaram, senior official of Standard Chartered Bank in India, made a presentations on M&A in Financial Services in South Asia. "It is quite clear that M&A is going to be a fact of life for Nepal," he predicted.

Siddhanta Raj Pandey, CEO of Ace Finance Company stressed on its practical aspects.

The programme was attended by senior bankers and entrepreneurs.