ICRA Nepal assigns Grade 3 to 25% right issue of NIC Asia Bank & LA-@ rating to subordinated bond of Rs 500 million

Wed, Apr 27, 2016 12:17 PM on Latest, Featured, Credit Rating, Stock Market,
ICRA Nepal has assigned an “[ICRANP] IPO Grade 3”, indicating average fundamentals to the proposed rights issue amounting NPR 923.754 million of NIC Asia Bank Limited (NICA). The process to issue right share of NICA is on review process in SEBON. As per the official of Sebon, the right issue will be approved by Sebon within 10 days after the completion of icra rating. Bhisma Chalise, CEO of Civil Capital Market Limited said, “As soon as Sebon approves the right issue, we will be floating the right share of NIC Asia Bank”. The commercial bank is proposing 4:1 (25%) rights issue of 9,237,540 numbers of equity shares at the face value NPR 100/-each to be issued to the existing shareholders at par. Civil Capital Market Limited has been assigned as the issue manager for the right issue. NICA had earned a net profit of Rs.  50.20 crore in the second quarter of the current fiscal year. The paid up capital of the bank stands at Rs 3.69 arba . After the issuance of 25 percent, the paid up capital will stand at Rs 4.61 arba. ICRA Nepal assigns IPO grading on a scale of IPO Grade 1 through IPO Grade 5, with Grade 1 indicating strong fundamentals and Grade 5 indicating poor fundamentals. Moreover, ICRA Nepal gives [ICRANP] LA-@ rating to NIC Asia Bank to subordinated bond of Rs 500 million. ICRA Nepal has assigned ICRA Rating of LA-@ (pronounced ICRA NP  L A minus @)to fresh and existing subordinated bonds of NICA, which indicates that the bank has adequate degree of safety regarding timely servicing of financial obligations assigned by ICRA Nepal. The rated entity carries low credit risk. The rating is under watch with negative Implications.