Nepal Rastra Bank has found NB Group, one of the main promoters of Nepal Bangladesh Bank, to be unfit to buy 40 percent of the company’s shares on sale, following a decision by the foreign shareholder group to leave.
IFIC Bangladesh, which holds 40 percent of the bank’s shares, had announced on July 13 that it intends to sell its stake in the bank and called on prospective groups to apply to buy the shares.
According to the central bank, only NB Group applied for the shares within the given deadline. However, the group was found to be ineligible to buy the shares following a ‘fit and proper’ test conducted by the central bank.
IFIC had bought the 40 percent shares from the NB group to become the biggest shareholder of the bank.
NB Group has had a history of financial controversies and been linked to different irregularities by regulating agencies in the past decades. At one point, Nepal Rastra Bank directly intervened in the bank to save the public’s money.
According to central bank sources, after the lone applicants were found unfit to buy the shares, IFIC can now directly deal with other groups to sell the shares. However, they too need to pass the central bank’s test.
Bank sources say that IFCI hopes to sign a deal with Chaudhary Group to sell the shares. Chaudhary Group is a major promoter of Nabil Bank, which is looking for banks to acquire or enter into a merger.