ICRA Nepal assigns grade 2 to upcoming FPO issue of Nepal SBI Bank; FPO to be issued from Sunday

ICRA Nepal has assigned an “[ICRANP] IPO Grade 2”, indicating above average fundamentals of the proposed Further Public Offer (FPO) amounting to NPR 6.58 crore  of Nepal SBI Bank Limited (SBI). SBI Bank is proposing to come out with FPO of 67,767.87 numbers of equity shares of face value NPR 100/- each to be issued to public at a premium of NPR 871 per share (issue price NPR 971 per share). The issue is being made to comply with minimum public shareholding norms (30%) as specified by Nepal Rastra Bank (NRB), the banking sector regulator. As per Icra Nepal, The above average fundamental grading factors in the bank’s strong promoter profile  and good market positioning in Nepal with ~4% share in commercial banking industry as on mid July -16. 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. Nepal SBI Bank Limited (SBI) will be issuing 67,767.87 units shares worth Rs 6.58 crore as a part of Further Public Offering (FPO) from Sunday (Poush 10, 2073). Nepal SBI Bank is issuing the FPO as per a directive issued by the central bank to maintain at least 30% stake of public shareholders in its share structure. At present its promoter shareholder: public shareholder ratio stands at 70.12:29.88. Two institutional promoters hold 70.12% of total shares in the Bank. State Bank of India holds 55.09% of the total ownership whereas Employee Provident Fund holds 15.03% shares. After the FPO, the promoter and public shareholder ratio will be maintained at 70:30.