Gramin Bikash Banks merger remains uncertain

ShareSansar, October 24:

A merger of all five state-run Gramin Bikash Banks has not been able to gain momentum though Nepal Rastra Bank has stated that it will complete the process for the merger by November 8.

The Gramin Bikash Bank Merger Committee officials have informed that the central bank is yet to address the conditions put forth by the employees of some of these rural development banks for the merger.

Though the Central, Mid-Western as well as Far-Western Regional Development Banks have already held special AGMs to approve of the merger, the Eastern and the Western Regional Development Banks are yet to hold their AGMs.

The central bank had directed all the five rural development banks to merge by completing all necessary procedures in the last fiscal year. But the merger could not take place due to various hassles created by some of the employees.

The employees of the Western Regional Rural Development Bank have been padlocking the bank to oppose the merger. They have been arguing that since only the Western Regional Rural DevelopmentBank has been making profit, the merger will not be beneficial to them.

The central bank, however, has not been able to make the agitating employees accountable for their protest against its decision.

The NRB had decided to merge all the five regional development banks as most of them on the verge of bankruptcy.

The rural development banks were jointly established by the government, the central bank and various BFIs, including most of the leading commercial banks, to assist economically marginalized farmers in the rural areas.

Central bank officials, nonetheless, maintain that they are firmly committed to ensure that the rural development banks merge. They informed that they have already completed the DDA for the merger and were awaiting final government approval.

The central bank is gearing up for the merger after the Supreme Court recently quashed a writ filed by the agitating employees of the Western Regional Rural Development Bank to stop the merger process.

In its verdict the apex court had ruled that since the merger was aimed at improving the financial health of all the rural development banks, it should not be opposed.