Nepal Bangladesh Bank likely to issue Right shares to maintain NRB mandatory Capital Adequacy Ratio & Paid up capital

At Present Nepal Bangladesh Bank Limited (NBB)  has two important matters  to focus on. The first issue is the Capital Adequacy Ratio that it needs to maintain by mid- July and the second important issue is to fulfill the paid up capital requirement of Rs 4 arba by the end of the ongoing fiscal year. As per the third quarterly financial report of Nepal Bangladesh Bank its Capital Adequacy Ratio (CAR)  stands at 10.57 percent which is sort of minimum 11 percent capital adequacy ratio (CAR) requirement directed by recently published Nepal Rastra Bank guildelines to all the commercial banks of Nepal. In order to maintain the CAR, Nepal Bangladesh Bank will either be issuing right shares or bonds to the shareholders and to the general public. The most feasible option for the bank is to issue right shares. Most likely, NBB Bank will be issuing right shares as it will not only help to maintain the CRR but also be a support to meet the paid up capital requirement of Rs 8 billion by the end of fiscal year 2073/74. As per the capital plan of Nepal Bangladesh Bank, 20% of paid up capital requirement of the bank  will be met by the bank by entering into merger/ acquisition process. As per the NBB bank offcial, “The bank has been holding merger and acquisition talks with Sindhu Bikas Bank Limited, Bagmati Development Bank Limited, Reliable Development Bank Limited, Global IME Bank  Limited, Hama Merchant and Finance Limited but the conclusions has not been reached yet.” Nepal Bangladesh Bank's  paid up capital is at  Rs 3.03 arba and reserve is at Rs 2.55 arba. There is rumor that the bank may propose up to 50% right share soon in the near future to meet up the requirement set by NRB. The Bank has posted a net profit of Rs 70 crore in the third quarter of the ongoing fiscal year.  Its EPS (annualized) stands at Rs 31, net worth per share at Rs 184 and P/E ratio is 18 times. The last trading price in the NEPSE as of 5th May, 2016 stood Rs. 637.