The Nepal Rastra Bank (NRB) has directed the Bank and Financial Institutions (BFI) to raise their paid-up capital by the end of fiscal year 2073-74. NRB had asked the BFI to publicly disclose their proposal to increase the paid up capital.
Sunrise Bank Limited and Infrastructure Development Bank Limited have been the first BFIs to publicly release their capital plan. The proposed capital plans of these BFIs are as follows:
Sunrise Bank Limited
Here is the plan of Sunrise Bank Limited to increase their paid up capital:
| S. No. |
Plans to raise paid up capital |
In Rs ‘000 |
| 1 |
Paid up capital till the end of fiscal year 2071/72 |
2,44,36,88 |
| 2 |
20 % Bonus share from the net profit of fiscal year 2071/72 |
49,20,63 |
| 3 |
Paid up capital after the issuance of bonus share |
2,93,57,51 |
| 4 |
From the auction of previous right shares |
16,6,27 |
| 5 |
Issuance of 15% right share in fiscal year 2072/73 |
36,90,47 |
| 6 |
From the institution getting merged with (including proposed bonus shares) |
2,64,00,00 |
| 7 |
Issuance of maximum of 15% bonus share from the profit of fiscal year 2072/73 after the merger |
89,42,14 |
| 8 |
Paid up capital by the end of Ashad 2073 |
6,86,56,39 |
| 9 |
Bonus share from the profit of 2073/74 |
1,16,54,59 |
| 10 |
Paid up capital By the end of Ashad 2074 (including assumed 17 % bonus share) |
8,02,10,98 |
If the bank have less net profit than expected and fails to issue bonus share as decided or financial institution the bank has plan to merge with has less paid up capital than the bank will go for merger by the end of fiscal year 2073/74 or issue right shares to meet the 8 arba paid up capital.
Infrastructure Development Bank Limited
Infrastructure Development Bank Limited (IDBL) has publicly announced the following proposal to meet its paid up capital plan as stipulated in Monetary Policy 2072-73. IDBL has kept merger & acquisition and issuing bonus share on top priority. Below is the detailed capital plan of IDBL:
“The institution is working duly in the participation of four Bank and Financial Institutions (BFI) including self, to be merged with class ‘A’ banks. There are total of five BFI in the process of merger. Among these five BFI, there are three national level development banks. A decision has been made so far that this merged institution does not necessarily need to make a separate Capital Plan. The merged institution will have the paid up capital of 8 arba by the end of Ashad 2074. In case of failure of the existing merger or the acquisition process of the institution, it can further go in process of merger with other banks and financial institutions. The bonus shares will be distributed from the profit of this fiscal year as well the profit of next two fiscal year.”
