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NMBFL to upgrade to commercial bank
14, Jan 2008

Nepal Merchant Banking and Finance Ltd (NMBFL) is being upgraded to ¿ `A' category ¿ a commercial bank.

Mahabir Prasad Goyal, chairman of NMBFL, during its 12th annual general meeting (AGM) informed that the company is set to issue 1:4 rights shares to increase its capital base. Following the rights share issue, the company plans to increase its paid-up capital to one billion rupees, which is necessary for upgrading it to a commercial bank. "NMBFL has already received a letter of intent to upgrade to `A' class financial institution and necessary arrangements are underway and expected to complete entire process in relation to application for the licence of commercial operation by the end of March this year," he said. NMBFL also declared 30 per cent cash dividend from the profit it made during the fiscal year 2006-07. It reported Rs 121 million operating profit and Rs 75.13 million net profit for 2006-07, whereas its total customer deposits grew by 50.24 per cent.

`Open market':

KATHMANDU: J Nadchatiram, managing director of Yong Lian Realty Sdn Bhd, a Malaysian partner of NMBFL urged the Nepal government to open its securities market, especially secondary capital market for foreign institutional investors. "This will certainly bring a new wave in the capital market. But the regulators must watch carefully and tighten the regulatory measures to ensure smooth and disciplined transactions," he said. Nadchatiram, however, said that political stability and pragmatic policy environment are two major parameters for Nepal to receive more foreign direct investments (FDIs). "Political stability is a `must' with pragmatic policy backup for attracting more FDIs, particularly for Nepal which is politically in transition phase," he said. The Malaysian company has 15 per cent stake in NMBFL.
Source:
The Himalayan Times

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