Kathmandu: Banks and finance companies are still prioritizing mergers and acquisitions. Top 16 banks and finance companies that have completed their annual general meetings of the fiscal year 2080/081 have passed merger and acquisition proposals. Out of the 20 commercial banks in operation, 4 banks have passed merger and acquisition proposals in their general meetings. Similarly, 7 development banks and 5 finance companies have also passed merger and acquisition proposals in their annual general meetings.

They have passed a proposal to authorize the board of directors to carry out merger and acquisition-related work with other suitable banks and financial institutions and to amend the bank's memorandum of association and regulations. Large banks are choosing the path of merger and acquisition to reduce the pressure on capital funds, while development banks and finance companies have put forward proposals to merge in droves after the financial crisis began in the institutions.

There are several banks in Nepal that have recently merged including Nabil Bank, Global IME Bank, Bank of Kathmandu, Prabhu Bank, Nepal Investment Bank, Nepal Bangaladesh Bank, NCC Bank, Kumari Bank, Himalayan Bank, Civil Bank, Century Commercial Bank and Mega Bank. 

Currently top 16  banks and finance companies are in discussions about merging. Top 4 commercial banks have passed merger and acquisition proposals in their annual general meetings for the fiscal year 080/081. Nabil Bank, Citizens Bank, Prime Commercial Bank and Nepal SBI Bank have passed merger and acquisition proposals in their annual general meetings. 

Top 7 development banks have also passed merger and acquisition proposals through their annual general meetings. The development banks that have passed merger and acquisition proposals include Miteri Development Bank, Garima Development Bank, Jyoti Development Bank, Corporate Development Bank, Shangri-La Development Bank, Shine Resunga Development Bank and Muktinath Development Bank.

Similarly, among the finance companies that called their general meetings last year, 5 finance companies have passed merger and acquisition proposals through their general meetings. The ones that have passed merger and acquisition proposals are Nepal Finance, Samriddhi Finance, Guheshwari Merchant Banking and Finance, Progressive Finance and Manjushree Finance.

Pokhara Finance has formed a merger committee after the on-site inspection of Nepal Rastra Bank indicated that it had reached a problem-oriented state. During the on-site inspection of the central bank, the Rastra Bank had alerted the board of directors, saying that the institution had reached a problem-oriented state due to insufficient monitoring by the committees under it.

After the Rastra Bank alerted, Pokhara Finance has formed a committee for acquisition, merger or merger. The company's board of directors meeting was informed by Finance's Chief Executive Officer (CEO) Ravi Chandra Gurung. According to him, Finance has formed a 2-member committee under the coordination of independent director Tilak Bahadur Gurung.

With the aim of strengthening financial stability, the National Bank had issued regulations on mergers and acquisitions of banks and financial institutions in 2068 BS. Then, revising it in 2073 BS, the National Bank issued the ‘Regulations on Mergers and Acquisitions of Banks and Financial Institutions, 2073 BS.’ In 2068 BS, the number of commercial banks was 32. Now, that number has come down to 20. In order to reduce the number of commercial banks, the National Bank adopted a policy of encouraging large mergers. Only then did the number of commercial banks start decreasing.