Investors in dilemma; Trading of Prabhu Bank halted; NRB directs Prabhu to merge with Grand Bank instead of Acquisition

Trading of scrips of Prabhu Bank Limited (PRVU) halts in Nepal Stock Exchange Limited as Nepal Rastra Bank (NRB) directs Prabhu Bank to go into the merger process with Grand bank Nepal (GRAND) in a letter dated Ashwin 12, 2072. Prabhu Bank was in the last stage of acquiring Grand Bank and had applied for the final approval of NRB to start integrated business but NRB has directed the banks to go for merger process instead of acquisition process looking at the swap ratio which is 121.45:65.58. A board meeting of the central bank held on June 17, 2015 had given a letter of intent to Prabhu Bank for the acquisition of Grand Bank Limited. Whereas now, when Prabhu Bank applied for the final nod of NRB, NRB asked to change the entire process. As per the Company Secretary Mr. Amit Bhandari, now it will take at least three months for the merger between Prabhu Bank and Grand Bank as the entire process needs to be carried out again. A new DDA needs to be done, he added. Special General Meeting (SGM) of Prabhu Bank held on 7th Shrawan, 2072 had approved the acquisition of Grand Bank Limited. Upon the NRB endorsement, the shareholders holding 100 units of Prabhu Bank shares were to get 21.45 shares in premium, and the shareholders holding 100 units of Grand Bank were to get 65.58 shares of Prabhu Bank.