Kathmandu. The merger between Nepal Investment Bank and Himalayan Bank has been confirmed. A Memorandum of Understanding (MoU) is to be signed between the two banks to formally merge by April 30.

The merger process between the two banks has gained momentum after the Board of Directors of Himalayan Bank approved the due diligence audit (DDA) report on Thursday. The meeting of the Board of Directors of Himalayan Bank could not be held after Chairman Tulsiram Gautam fell ill for about a month.

The Board of Directors of the Investment Bank had approved the DDA report in the first week of April.

Top officials of both the banks informed that they are preparing to sign the MoU soon.

"Our merger committee will finalize everything within three to four days and we are working to sign the MoU next week," said a senior Himalayan Bank source.

Although the Investment Bank has been working fast recently, the merger process has been delayed due to Himalayan Bank.

It has been agreed that the share exchange ratio will be 1 to 1 when the two banks merge, with Chairman Prithvi Bahadur Pandey and CEO Ashok Rana. The rest of the agreement will be reached after the MoU by forming various sub-committees.

NRB has used both pressure and encouragement to merge the two banks. As this merger will be the largest in the history of Nepal so far, a wave has been created in the banking sector.

The bank to be formed after the merger of the two banks will have an average paid up capital of Rs 47 billion and will be the largest bank in the country in all respects. And, other banks are believed to be under pressure to merge. 

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