Is the policy of Nepal Rastra Bank to get big banks merger baring fruit? Prime Bank and Om Development Bank making buzz in the market for a good reason

Prime Commercial Bank Limited (PCBL) has been reported to be in the final likely stage to acquire Pokhara Based National Level Development Bank Om Development Bank Limited (ODBL)

According to the fourth quarter report of the banks, their paid-up capital stands at Rs 8.03 arba and Rs 2.51 arba respectively. Although the share swap ratio for the potential acquisition process has not been made public yet, which mostly will be derived from the DDA report of both institutions, however, it can be assumed that the newly formed entity will have around Rs 10 arba as its paid up capital.

It can be easily inferred that the commercial bank which apparently doesn’t have strong presence as evident in its relatively small branch network will receive a major boost to its business after acquiring Pokhara based development bank with strong presence in the urban and rural areas of the west Nepal.

CEO of the development bank Mr. Bishwo Mohan Adhikari informed that his organization is currently under discussion with the Prime Bank for the final negotiation and the public will get to know about the good news soon. Even the Deputy General Manager of Prime Bank Mr. Bhai Raja Tuladhar echoed the similar sentiment who expressed his optimism that a good news will be popping up by this evening.

The table below presents the quick glance of both these financial institutions: