December 31:  Nabil Bank has started preparations to acquire Nepal Bangladesh Bank (NBB). Both Nabil and NBB have formed a merger committee to take the process forward. Rumors were circulating about the merger between these two banks for a long time but the process had not started. 

The board meeting of Nabil Bank held on Wednesday, December 29 formed a merger committee under the leadership of board member Uday Krishna Upadhyaya. The committee has initiated discussions regarding the merger.

Anil Keshari Shah, CEO of Nabil Bank informed that a merger committee has been formed to hold discussions with NBB. "However, we did not form the merger committee to specifically acquire Nepal Bangladesh Bank. Discussions are on while we are also approaching other banks for acquisition," he said. 

Nepal Bangladesh Bank has also formed a merger committee. "If agreement is reached between these two banks, a joint merger committee will be formed. After that, the process will move further ahead, "said Shah.

In 2019, Global IME Bank acquired 'A' class Janata Bank. Likewise, other 'A' class banks including Nepal Investment Bank and Himalayan Bank are also in the process of merger. Nabil Bank and Nepal Bangladesh Bank are also preparing for the big merger.

Nabil Bank is invested by Chaudhary Group of Nepal while IFIC Bank of Bangladesh holds shares in NBB. Binod Chaudhary, chairman of Chaudhary Group had been trying to buy shares of IFIC Bank in NBB since last year but hadn't succeeded due to various obstacles. It is said that the central bank has now removed the hurdle. 

 IFIC Bank is also preparing to exit the country by selling shares of NBB. The Chaudhary Group plans to buy shares and merge the bank with Nabil Bank. The merger between these two banks have been rumored for many months. Lack of agreement on the swap ratio was preventing the merger process. There has been some unofficial agreement on the swap ratio. The final decision will be made only after conducting an asset and liability study. It is said that both the banks have also taken the DDA process forward.

The share price of NBB had hit a positive circuit on Wednesday, December 30 after the news of merger came out. The share price increased by 9.8 percent to 402 per share on Wednesday. The share price of Nabil Bank is Rs. 1450 per share.