Governor clarifies NRB's stance on Big Merger; Highlights the importance of big merger in strengthening IT system of Nepali banking industry

The date for Monetary Policy FY 2076/77 nears, and with it increases the pressure for banks into big merger. As the Governer Dr. Nepal puts it, The count down has begun.

In a program Governor stated that the banks will need to be ready for merger once the Monetary Policy comes out. Therefore, if the banks want to screen their choice then now will be a good time.

In the same program, the vice chairman of Nepal Chamber of Commerce Mr Kamlesh Agrawal had mentioned that merger between banks is sort of a Marriage and therfore should not be forced. It shold be a Love marriage, where the parties involved are in consent and satisfied with their choice. Remarking to that address, Governor suggested banks to starting banks to fall in love before policy announcement.

The primary goal behind the minimum paid-up capital requirement of BFIs in past had been to consolidate the financial market. The fact that it hadn't been mentioned overtly in terms of policy directins many BFIs resorted to bonus shares, right shares and further public offering.

However, this fiscal year as it seems NRB is going to be sufficiently clear on how the process is going to go ahead. He also made it clear, in no uncertain terms, that no amount of political lobbying will affect this decision and thus asked to refrain from such activities as Big merger has come under the priority of Budget itself.

The merger, Governor mentioned, will strengthen the information technology of our banking system. It will also subdue the problem of liquidity shortage that has been going on for quite some time. Similarly, the scattered funds will be centralized which will facilitated investments.