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Business development bank has opened its third branch in Damauli, Tanahu. The bank has opened its first two branches in New Road and Birauta of Pokhara. For the purpose of establishing itself as a development bank it has aimed to increase its capital. Therefore, the bank has recently announced to issue its right share.
Source: Jamb News Service
Nepse has barred share trading of three more financial institutions (FIs). The FIs should get Letter of Intent (LoI) from the Nepal Rastra Bank (NRB), the regulatory authority, to merge. "Otherwise the share trading will be automatically barred. National Finance, Narayani Finance and Paschimanchal Finance have been barred from trading their shares from Sunday until further notice," states a press release issued here by the Nepal Stock Exchange (Nepse). These institutions have announced merger to upgrade to the B-class development bank. "However, they don't have yet got LoI from the central bank yet.
Two of them — National Finance and Narayan Finance — had earlier also entered into an agreement to merge with Mahalaxmi Finance and upgrade to B-class development bank. "But they broke the agreement and Mahalaxmi Finance entered into yet another agreement with other four financial institutions to upgrade to A-class commercial bank," Rewat Bahadur Karki, general manager of the Nespe, said, adding that Nepse is serious in such merger cases as they have already failed to act on earlier agreement. "The agreement might fuel the price of the shares of these companies ‘unnaturally'."
"The financial institutions going for merger should get the Letter of Intent from the NRB first," he said, adding that otherwise the share trading of such companies will automatically be barred from now onwards," he added. Nepse has barred share trading of five financial institutions; Mahalaxami Finance Ltd, Birgunj Finance Ltd, Siddhartha Finance Ltd, Butwal Finance Ltd and Himchuli Development Bank until further notice — from yesterday. The four finance companies and a development bank have jointly announced merger to become a commercial bank with a paid up capital of Rs 2 billion. The news of merger and upgradation has fuelled the share price of these financial companies. Mahalaxmi Finance Ltd, Birgunj Finance Ltd, Siddhartha Finance Ltd, Butwal Finance Ltd and Himchuli Development Bank have signed an accord last week to merge and upgrade to A-class commercial bank.
Market capitalisation up by 77.3pc KATHMANDU: The year on year (y-o-y) Nepse index has increased by 44.7 per cent to 714.76 points in mid-March 2008. This index was 494.06 a year ago, according to macroeconomic situation based on eight months of this fiscal year. "The y-o-y market capitalisation has increased by 77.3 per cent to Rs 230.82 billion in mid-March 2008. Market capitalisation to GDP ratio increased to 29.1 per cent from 18.1 per cent a year ago. Of the total market capitalisation, bank and financial institutions hold the largest share, states the report published by NRB.
Total paid up capital of the listed companies has also increased by 17.01 per cent amounting to Rs 24.59 billion in mid-March 2008, due to the additional listing of securities. Total number of companies listed at the Nepse stood at 146 in mid-March 2008 compared to 131 a year ago. Among them, bank and financial institutions are 111. Production and processing industries, hotels, business entities, hydropower and companies in other groups are 21, 4, 5, 3 and 2, respectively. "Monthly turnover to market capitalisation ratio stood at 0.81 per cent in mid-March 2008 compared to 0.55 per cent a year ago," states the report.
The twelve-month rolling standard deviation reflecting an increased volatility in the stock market stood at 172.4 in mid-March 2008 compared to 69.2 a year ago. Securities Board of Nepal (Sebon) granted permission for primary issuance of Rs 4.98 billion in the first eight months of 2007-08. These consist of ordinary shares of Rs 402.4 million to eight companies, right shares of Rs 3.08 billion to seventeen companies and debentures of Rs 1.50 billion to Nepal Electricity Authority (NEA).
The government also issued Treasury Bills of Rs 6 billion, Development Bonds of Rs 2.4 billion and Citizens Saving Certificate of Rs 800 million in the first eight months of this fiscal year, according to the NRB report. — HNS
Source: THT
Sunrise Bank has opened two more branches at Besisahar of Lamjung and Damauli of Tanuhun. Besisahar branch was jointly inaugurated by social workers Bal Krishna Baral and Dr Bhogendra Guragain, while Damauli branch was inaugurated by senior linguist Dr Basudev Tripathi and Motilal Dugar, director of the bank. With the two new branches, Sunrise has spread its branch network to three places outside the capital, states a press note. "These branches will also provide all the banking facilities."
Source: The Himalayan Times
The inflation is balloning due to rise in the prices of food articles like rice and rice products, and oil and ghee. According to the current macroeconomic situation based on first eight months' data, it stood at 7.2 per cent in mid-March compared to 6.2 per cent in the corresponding period last year. The report by the central bank paints a bleak picture as the budget is also at deficit of Rs 6.99 billion due to higher growth of government expenditure. In the same period last year, the budget was at the surplus of Rs 1.18 billion. Of the sources of deficit financing, government mobilised domestic borrowing of Rs 9.20 billion (excluding overdraft), states Nepal Rastra Bank's (NRB) report. In the review period, the net domestic borrowing remained at a negative of Rs 433.14 million as the government repaid domestic borrowing worth Rs 5.29 billion. In the first eight months, government expenditure, on a cash basis, increased by 32.5 per cent to Rs 80.34 billion compared to an increase of 15 per cent in the same period last year, states the report. However, revenue mobilisation has increased by 26.2 per cent to Rs 60.61 billion compared to an increase of 16.4 per cent in the corresponding period last year. According to the central bank, liquid funds of commercial banks also increased by 6.8 per cent to Rs 69.61 billion in the review period. "Commercial banks have Rs 129.95 billion liquid assets as of mid-March 2008, including Rs 60.34 billion holding of government securities," states the report. A net liquidity of Rs 54.99 billion was injected through foreign exchange intervention in the review period compared to Rs 44.43 billion last year. The higher inflow of remittances in the review period increased the purchase of the US dollar in the foreign exchange market. For managing liquidity of banking system, a total of Rs 9.27 billion has been absorbed in open market operation including Rs 5.57 billion through reverse repo auctions and Rs 3.7 billion through outright sale auctions in the review period. "A short-term liquidity shortfall was observed by some commercial banks in the review period on account of over subscription in initial public offering of shares by ADB/N and the issuance of electricity bond by Nepal Electricity Authority," it states. Total exports went down by 2.6 per cent compared to a decline of 6.6 per cent in the corresponding period last year, according to the report. "Of the total exports, export to India plummeted by 6.9 per cent in 2007-08 compared to a decline by 6.4 per cent in the same period of 2006-07." The drop in the exports to India was largely due to the fall in the exports of vegetable ghee, textiles, chemicals, wire and thread. The overall Balance of Payment (BoP) has, however, posted a surplus of Rs 13.29 billion in the review period. It had registered a surplus of Rs 12.28 billion in the corresponding period last year.
Source: THT
Badri Prasad Ojha, chairman of Sanima Development Bank Ltd (Sanima), inaugurated its third branch in Dhadingbesi, Dhading on Wednesday. The bank facilities innovative schemes, debit card facility, SMS banking service, fund transfers/demand draft issuance, locker facility, PSTN telephone bills payment and extended banking hours, states a press release. Sanima has collected a total of Rs 2.60 billions deposit and floated Rs 2.25 billion loans in the Q3. It has also posted an operating profit of Rs 32.43 million.
Source: THT
Tola Ram Dugar, chairman of Sunrise Bank and Deep Shrestha, a noted singer, jointly inaugurated the first branch in Dharan on Wednesday. The newly opened branch will provide all the banking facilities that the head office in Kathmandu offers, states a press release. Sunrise is planning to open two more branches in Besisahar and Damauli soon. It has collected a total of Rs 4.5 billion deposit and floated Rs 2.5 billion loans so far.
Source:
The Himalayan Times
A giant organization with huge capital and promoters is on its way to operate as a commercial bank in near future. The company beholds 1200 promoters with the share capital of Rs. 2 billion right in the beginning. "Hamro Bank" is the name given to this bank which has reached the final steps of its formal proceedings with Nepal Rastriya Bank (NRB). The bank comprises 30% of the share of general public, and remaining 70% of other promoters which implies that the general public has invested Rs. 600 million in this bank. The promoters of the bank incorporates investors from various field such as PABSON, various government and non government organizations, publication houses, foreign employment organizations, tourism and travelling agencies, finance companies, share investors, universities, higher secondary schools, carpet and pashmina industry related persons, doctors, engineers and even lawyers are included in here. The bank will commence its operation within 6 months after the head bank (NRB) permits. It is yet to be decided on where the head office will be located. The formal proceedings are being carried out in a temporary office with 13 members situated in Naxal. Another giant includes a merger of 5 organizations, 1 development bank and four finance companies. Mahalaxmi Finance Ltd, Birgunj Finance Ltd, Siddhartha Finance Ltd, Butwal Finance Ltd and Himchuli Development Bank have amalgamated to form a big commercial bank with Rs. 2 billion in hand. The name of the commercial bank is yet to be decided. All the financial institutions are planning to increase their paid up capital to Rs 400 million each to make Rs 2 billion in total required for the up gradation for the commercial banks. The united banks will have its head office in Kathmandu while their prevailing offices will be the branches of the bank. Mahalaxmi Finance, National Finance and Narayani Finance have earlier declared a merger for upgradation to a Development bank. However, the plan didnot work.
Source: Jamb News Service
