Kathmandu. Merger agreement has been broken between two big banks, Nepal Investment Bank and Himalayan Bank. The special proposal regarding the merger has been rejected by the general meeting of Himalayan Bank.

Ashok SJB Rana, chief executive officer of the bank's Himalayan Bank, said the 75 percent majority needed to pass the special resolution was not reached as the bank's large investors were in opposition.

Despite the signing of the merger agreement between Himalayan Bank and Nepal Investment Bank on April 12, the bank's big investor Employees Provident Fund and Chairman Prachanda Bahadur Shrestha have been against the merger recently. According to an operator of Himalayan Bank, Chairman Shrestha was against the merger when there was a split vote in the merger proposal.

The two banks, which had received permission from NRB to start integrated business within three months after the merger agreement, could not complete the merger process on time. NRB then extended the time for another three months.

After the merger proposal of Himalayan Bank failed from ordinary meeting, now the possibility of merger has been ruled out. Employees' Provident Fund is also one of the major investors of Himalayan Bank. Tulasi Gautam, the administrator of the Employees' Provident Fund, was the chairman of the bank when the merger agreement was signed. But after the Sher Bahadur Deuba-led government removed Gautam, Prachanda Bahadur Shrestha became the chairman of Himalayan Bank. The process did not move forward after Chairman Shrestha himself opposed the merger.