Excel planning to issue 35% bonus share; 35 % right share, too, expected soon

ShareSansar, September 4:

Excel Development Bank Limited, one of the best class ‘B’ BFIs, has stated that it is planning to float 35 percent bonus share to the shareholders for the last fiscal year 2070/71.

“To meet the paid-up requirement of the central bank directives, we are planning to pledge 35 percent bonus shares to the shareholders from the last fiscal year’s earning,” Chief Executive Officer of the 10-district development bank Dinesh Kumar Pokharel. “However, it is up to our Board of Directors and the central bank to approve it.”

Excel had posted Rs 6.2 crore net profit in the last fiscal year, up from Rs 2.45 crore. It is a huge achievement considering the fact that its paid-up capital has just reached Rs 15 crore -- that too after floating 50 percent bonus share to the shareholders from the profit it earned in the last fiscal year 2069/70.

It may also be noted that Excel, which is headquartered at Anarmani in Jhapa district, had posted a net profit of Rs 4.10 crore in the third quarter, which was double the net profit it posted in the last fiscal year.

Explaining as to why Excel must issue bonus share this time around, CEO Pokharel said, “The central bank does not allow us to give cash dividend until we meet 12 percent capital adequacy ratio. If we could have floated 35 percent right share as we had planned within the current fiscal year then we would have been in a position to offer cash dividend as well.”

The development bank with 12 branches all over eastern Nepal has very good market hold in key markets in the region.

Explaining why Excel has not been able to float the right share endorsed by its last AGM, Pokharel said that the process has been slightly delayed owing to promoter share conversion process.

“We are in the process of converting 70 percent of the promoter shares into 51 percent. The right shares can only be issued after that,” he said. “We hope that we will be able to float the right shares shortly.”