Manakamana to issue IPO worth Rs 300m

Manakamana Development Bank is going to issue ordinary shares worth Rs. 300 million in order to increase its paid up capital Rs. 1 billion.With the injection of public capital in the bank, it will be the development bank having the highest paid up capital. The bank's existing paid up capital stands at Rs. 700 million.

The annualgeneral meeting held on Friday decided to go for initial public offering (IPO). Bank's general manager Bhaskar Rimal said that the bank had already applied to Securities Board of Nepal seeking permission for IPO and hoped that the IPO could be issued within a month.After the new group took the majority ownership of crisis-ridden Cottage and Small Industries Development Bank about a year ago, the bank's name was changed into Manakamana Development Bank.A 41-member new team has injected as high as Rs. 540 million within four months to revive the bank. "We have reduced the ratio of non-performing loans (NPL) to 33 percent from 73 percent," said Bhusan Rana, chief executive officer of the bank. The bank said it plans to reduce the NPL to five percent soon.The bank registered net profit of Rs. 109 million in the last fiscal year and its capital adequacy ratio also remained at 59.36 percent last year. "We plan to increase our net profit to Rs. 200 million this year," said Rimal. The bank officials said that they were also making preparation to upgrade the development bank to commercial one from next year.

Source:eKantipur