Samriddhi Finance and Pokhara Finance Agree on 1:1 Swap Ratio for Merger

Samriddhi Finance Company Limited and Pokhara Finance Limited have agreed to move forward with a merger by fixing a 1:1 share swap ratio. The decision was approved by the board meetings of both companies held on Sunday, endorsing the recommendation made by the joint merger committee. The two finance companies had signed a Memorandum of Understanding for the merger on Shrawan 4, 2082 (BS), and based on the Detailed Due Diligence Assessment (DDA) report covering assets, liabilities, and business operations, they have agreed to merge on an equal footing. According to the unaudited first-quarter financial statements of FY 2081/82, Pokhara Finance has a paid-up capital of NPR 1.08 billion with reserves exceeding NPR 510 million. The company has mobilized deposits of around NPR 11.80 billion and extended loans worth NPR 9.65 billion, earning a net profit of NPR 18.4 million during the review period, although its non-performing loan (NPL) ratio stands at 4.34 percent. On the other hand, Samriddhi Finance has a paid-up capital of NPR 818.9 million and posted a net profit of NPR 5.056 million in the latest quarter. It has collected deposits of NPR 3.27 billion and disbursed loans of NPR 2.47 billion, while its reserve fund remains negative by NPR 269.4 million. Following the merger on an equal basis, the combined entity’s paid-up capital is expected to exceed NPR 1.90 billion, significantly strengthening its capital base. With the swap ratio finalized, both companies will now proceed to seek final approval from Nepal Rastra Bank and pass the merger proposal through their respective general meetings.