BoK signs merger deal with ILFC, Shree Investment and Nepal Express

ShareSansar, June 13:

Bank of Kathmandu has finally sealed a merger deal with three BFIs after months of closed-door negotiations.

BoK’s Chairperson Satya Narayan Manandhar, International Leasing and Finance Company (ILFC)’s chairperson Anjay Bahadur Shah, Shree Investment and Finance Limited’s chairperson Rabindra Raj Pandey and Nepal Express Finance’s  chairperson Satosh Narayan Shrestha signed the MoU yesterday.

The merged entity will be named BoK.

However, a highly placed source at BoK told that the MoU was basically meant to start the DDA for the merger, and went on to add that the merger process may break down if they cannot reach an agreement on the swap ratio.

Meanwhile, trading of all the four BFIs has been halted, and is likely to resume only after 5 to 6 months if the merger process succeeds.

BoK has a paid-up capital of Rs 1.92 arba where as the paid-up of ILFC, Shree Investment and Nepal Express stand at Rs 2.88 arba, Rs 17.60 crore and Rs 19.70 crore respectively.

Likewise, BoK  has 50 branches, nine extension counter, 57 ATM and 24 branchless banking service. ILFC has nine branches, Shree Investment has two and Nepal Express has four branches. Nepal Express also has one extension counter.

Back in January, all the BFIs had formally sought the central bank’s approval for the merger as they have more or less completed all the internal procedures for the merge.
 
The BFIs are, however, yet to work out the representation of the finance companies on the board and the management of the BoK, sources privy of the development said.
 
It may also be noted that some of the promoters of the BoK and ILFC are common.
 
Earlier ILFC was reported to have been working for a merger with Grand Bank.