Merger/Acquisition Of Microfinance Companies In Nepal

July 14, 2020 | Investopaper

With the wave of Merger and Acquisition (M/A) in the A, B and C class financial institutions, ‘D’ class microfinance companies have also joined the merger movement. Nepal Rastra Bank, the central bank of Nepal is looking forward to reduce the number of microfinance as well. At current, there are 90 microfinance institutions in Nepal [As of Mid April 2020].

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The central bank has offered a number of incentives to the microfinance companies that opt for  merger or acquisition [As per Monetary Policy 2019/20]. Nepal Rastra Bank has extended loan limits for microfinance from Rs. 1 million to Rs. 1.5 million provided to the members of group or individuals residing in rural municipalities for operating micro-enterprises against the acceptable collateral. Similarly, the existing provision of cooling period of six months will not be applicable for the members of board of directors and chief executive officer while joining other institutions licensed by this Bank. The central bank has also provided additional time to those microfinance to comply with the required capital adequacy ratio.

Also Read: Top 5 Microfinance Companies In Nepal

Following NRB directives, several microfinance companies have entered into M/A with other ‘D’ class institutions. Until now, 19 microfinance companies in Nepal have successfully completed merger/acquisition and formed 9 financial institutions. Likewise, additional 21 microfinance companies have entered in M/A agreement and are likely to reduce to 10 microfinance institutions. The number of microfinance companies will further decline as other M/A cases arise.

Related: Mergers and Acquisitions Of Development Banks of Nepal

Successful Merger/Acquisition Of Microfinance Companies In Nepal

The table below presents the list of microfinance companies which have successfully completed M/A. The joint transaction date of these companies is also shown below.

Microfinance In M/A Name After M/A Joint Transaction Date
Sadhana Laghubitta Bittiya Sanstha Limited Sadhana Laghubitta Bittiya Sanstha Limited Ashad 30, 2076
Sambriddhi Laghubitta Bittiya Sanstha Limited
Womi Laghubitta Bittiya Sanstha Limited Womi Laghubitta Bittiya Sanstha Limited Mangsir 30, 2076
Nagarik Laghubitta Bittiya Sanstha Limited
Sarathi Laghubitta Bittiya Sanstha Limited Sarathi Laghubitta Bittiya Sanstha Limited Poush 4, 2076
Satyawati Laghubitta
Kalika Laghubitta Bittiya Sanstha Limited Kalika Laghubitta Bittiya Sanstha Limited Poush 23, 2076
Janasewi Laghubitta Bittiya Sanstha Limited
Suryodaya Laghubitta Bittiya Sanstha Ltd. Suryodaya Laghubitta Bittiya Sanstha Ltd. Falgun 10, 2076
Trilok Laghubitta Bittiya Sanstha Limited
Mirmire Laghubitta Bittiya Sanstha Limited Mirmire Laghubitta Bittiya Sanstha Limited Ashad 21, 2077
Cweda Laghubitta Bittiya Sanstha Limited
Aarambha Laghubitta Bittiya Sanstha Limited Aarambha Chautari Laghubitta Bittiya Sanstha Limited Ashad 22, 2077
Chautari Laghubitta Bittiya Sanstha Limited
Unnati Laghubitta Bittiya Sanstha Limited Unnati Sahakarya Laghubitta Bittiya Sanstha Limited Ashad 26, 2077
Sahakarya Laghubitta Bittiya Sanstha Limited
NRN Laghubitta Bittiya Sanstha Limited NRN Laghubitta Bittiya Sanstha Limited Ashad 29, 2077
Dibya Laghubitta Bittiya Sanstha Limited
Kisan Laghubitta Bittiya Sanstha Limited

Related: Technical Issues in Bank Merger

Microfinance In Merger/Acquisition Process

The table below shows the list of microfinance companies that have entered into M/A agreement.

Microfinance In M/A Merger/Acquisition
Mirmire Laghubitta Bittiya Sanstha Limited Acquisition
Nagbeli Laghubitta Bittiya Sanstha Limited
Adhikhola Laghubitta Bittiya Sanstha Limited Merger
Dhaulagiri Laghubitta Bittiya Sanstha Limited
Swarojgar Laghubitta Bittiya Sanstha Limited Acquisition
Janakpur Laghubitta Bittiya Sanstha Limited
Summit Laghubitta Bittiya Sanstha Limited Merger
Sajilo Laghubitta Bittiya Sanstha Limited
Naya Nepal Laghubitta Bittiya Sanstha Limited Merger
Sarathi Laghubitta Bittiya Sanstha Limited
Nepal Agro Laghubitta Bittiya Sanstha Limited Merger
Nesdo Samriddha Laghubitta Bittiya Sanstha Limited
Mahuli Laghubitta Bittiya Sanstha Limited Merger
Nabikaran Laghubitta Bittiya Sanstha Limited
Smart Laghubitta Bittiya Sanstha Limited Merger
Manakamana Laghubitta Bittiya Sanstha Limited
Jeevan Bikas Laghubitta Bittiya Sanstha Limited Merger
Garibi Nyunikaran Laghubitta Bittiya Sanstha Limited
Solve Laghubitta Bittiya Sanstha Limited
Unique Laghubitta Bittiya Sanstha Limited Merger
Buddha Jyoti Laghubitta Bittiya Sanstha Limited

Read Related Contents: 

List of ‘D’ Class Microfinance Companies In Nepal

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One thought on “Merger/Acquisition Of Microfinance Companies In Nepal

  • July 29, 2020 at 2:55 am
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    nice information too much useful in stock market.
    thank u

    Reply

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