July 8: Bothered by increasing practices of breaking merger, Nepal Rastra Bank (NRB) has decided to take action against the banks which break the merger in the last hours after signing MOU. “In recent days, such regulations have even more significance,” said a NRB official.

Recently, Machhapuchhare Bank and Janata Bank had submitted a proposal in NRB to break the merger. In the context, BOD meeting of NRB suggested to lengthen the restriction in the share transactions of those banks as an action. However, it would have violate the consumers right of trading shares, thus the majority of BOD didn’t approve the action. Similarly, due to the lack of rules and regulation, NRB could not decide of other actions to be taken on the banks. Thus, NRB set the banks free with a simple warning.

 NRB has not been able to take solid action against those banks that break merger except of giving warning although the merger process consumes big financial sum and time due to the short of rules and regulation. “We cannot force banks to merge if both the banks want to demerge,” said NRB source adding that “It will be more difficult to solve the problem in future if the forceful action results other problems.”

 At present, NRB has prepared the initial draft of the possible actions to be taken against the banks which it was preparing since last six months.  “NRB has already made the draft and discussion will begin as soon as the monetary policy comes,” informed the source. According to the source, NRB has planned to bring the work procedure by the second week of Shrawan.