Bankers demand more merger incentives
KATHMANDU, JUN 02 -
Bankers on Wednesday demanded that the government provide tax incentives to banks going for merger.
With some banks and financial institutions already starting merger processes, bankers asked the government to slash corporate tax to merging institutions.
At a discussion between Finance Minister Bharat Mohan Adhikari and chief executives of banks held at finance ministry on Thursday, bankers urged the government to announce incentives in next year’s budget. The ministry had called the CEOs to discuss measures to be taken in the new budget to address challenges facing the banking sector.
Nepal Bankers’ Association Vice President Rajan Singh Bhandari said they urged the government to reduce the corporate tax to 25 percent from the current 30 percent along with other tax incentives for merging banks.
They also requested the government to spend the budget lying in its treasury to ease the liquidity crunch prevailing for the last one-and-a-half years. As of May 20, the government’s treasury has Rs 16.14 billion, according to NRB. The ongoing liquidity crunch has confined lending capacity of banks leading to slow growth in credit. “We also sought certain relief package for the banking sector like that done in the West during the financial crisis,” said Upendra Poudel, CEO of NMB Bank.
According to the ministry press release, Adhikari said he will address problems facing banking sector through dialogue with bankers and other stakeholders. Among the issues raised during the discussion are liquidity crunch, foreign investment in banking sector, merger of banks and financial institutions, investment in the realty sector, capital market and corporate governance, according to the ministry.
Nepal Rastra Bank (NRB) Governor Yubaraj Khatiwada said the action being taken against banks and bankers involved in bad corporate governance will have a positive impact on the economy.
Finance Secretary Krishna Hari Baskota said he asked financial institutions to maintain financial discipline.
Source: Kantipur
Bankers on Wednesday demanded that the government provide tax incentives to banks going for merger.
With some banks and financial institutions already starting merger processes, bankers asked the government to slash corporate tax to merging institutions.
At a discussion between Finance Minister Bharat Mohan Adhikari and chief executives of banks held at finance ministry on Thursday, bankers urged the government to announce incentives in next year’s budget. The ministry had called the CEOs to discuss measures to be taken in the new budget to address challenges facing the banking sector.
Nepal Bankers’ Association Vice President Rajan Singh Bhandari said they urged the government to reduce the corporate tax to 25 percent from the current 30 percent along with other tax incentives for merging banks.
They also requested the government to spend the budget lying in its treasury to ease the liquidity crunch prevailing for the last one-and-a-half years. As of May 20, the government’s treasury has Rs 16.14 billion, according to NRB. The ongoing liquidity crunch has confined lending capacity of banks leading to slow growth in credit. “We also sought certain relief package for the banking sector like that done in the West during the financial crisis,” said Upendra Poudel, CEO of NMB Bank.
According to the ministry press release, Adhikari said he will address problems facing banking sector through dialogue with bankers and other stakeholders. Among the issues raised during the discussion are liquidity crunch, foreign investment in banking sector, merger of banks and financial institutions, investment in the realty sector, capital market and corporate governance, according to the ministry.
Nepal Rastra Bank (NRB) Governor Yubaraj Khatiwada said the action being taken against banks and bankers involved in bad corporate governance will have a positive impact on the economy.
Finance Secretary Krishna Hari Baskota said he asked financial institutions to maintain financial discipline.
Source: Kantipur
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