Mega Bank Nepal and Tourism Development Bank have officially started joint operation since Sunday, following the merger of the two financial institutions. The united entity now has a paid up capital of Rs9.29 billion.

Mega Bank had proposed merging with Tourism Development Bank as part of its capital increment plan according to the directive of Nepal Rastra Bank.

Prior to the merger, Mega Bank had paid up capital of Rs7.38 billion while the development bank’s capital stood at Rs1.91 billion.

The merger was finalised at swap ratio of 1:0.95, under which Rs100 per share of Mega Bank has been maintained against Rs95 per share for Tourism Development Bank.

Mega Bank Chief Executive Officer Anupama Khunjeli said they had formally started unified operation from Sunday. According to her, Mega Bank is planning to extend its business areas with the merger.

It has been over a year since the financial institutions initiated the merger process. Following the settlement of the swap ratio, the two banks last month signed a memorandum of understanding for merger.

Two weeks ago, the central bank and the Office of Company Registrar rendered final approval for the acquisition of the development bank by Mega Bank.

Khujeli said the process was delayed after the central bank directed both entities to finalise the issuance of their right shares before completing the merger process.

 She added that the aim of the merger is to extend their banking services at the grassroots levels while ensuring double digit returns to shareholders.

“Furthermore, we have plans to open ‘one stop service’ outlet in Thamel, one of the main hubs for tourism, by the end of the current fiscal year” Khunjeli said. “Through the outlet, we will provide all of our financial services to the hospitality businesses in the area.” According to her, Mega Bank has nearly settled all the manpower working in the Tourism Development Bank. Following the unification, the bank now has 886 employees in total.

Mega Bank now provides its service through 91 branches, including 36 branches of Tourism Development Bank, spread in 49 districts across the country.

The bank has targeted to open 11 new branches by the end of this fiscal year.

In addition, the bank operates 74 ATMs, more than 1,800 Mega Remit Agents, eight extension-counters

and 58 branchless banking services. After merger, the bank’s deposit collection now stands at Rs57.55 billion. It has provided loan of Rs55.70 billion.

POST MERGER

Paid up capital of Rs9.29 billion

Deposit collection at Rs57.55b

Swap ratio of 1:095

91 branches in 49 districts

Mega now has 886 employees