Global IME then became the ‘number one’ bank in Nepal


Global IME then became the ‘number one’ bank in Nepal

Until two years ago, this English term heated up the financial market. The word ‘big merger’ was on the lips of all those interested in the financial sector because of the desire of the Nation Bank to merge the big banks and the policy taken by the then government.The government raised this issue in the budget statement of the Fiscal Year 2076/77. Then the discussion of ‘force merger’ also started in the financial market.

Many in the financial sector at the time had estimated that the central bank could now forcibly merge the banks with the support of the government. The central bank, on the other hand, said that it would provide some facilities to the banks to encourage spontaneous mergers and requested them to cooperate in the Big Merger scheme.

Not to mention, the then Global IME Bank and Janata Bank Nepal announced the merger. With the initial merger agreement, the integrated business also gained momentum. Eventually, the two largest commercial banks merged to form Global IME Bank. This merger brought a kind of wave in the economic sector.

Global IME Bank, formed after that merger, became the largest bank in the country based on many indicators. This bank number one has not been formed so easily. The success story of Global IME Bank, which has come this far after a difficult journey in the financial market, should reach the history of Bhuvan Remittance.

After Nepal opened Malaysia for foreign employment in 2001, many Nepalis arrived there in the same year. At the same time, the number of Nepali workers being cheated due to money orders started increasing. Nepal Rastra Bank also became concerned as the flow of money through informal channels increased.

Chandra Prasad Dhakal, chairman of Global IME Bank, tried to turn this problem into an opportunity, the same year. He had the experience of being an agent of money transfer company ‘Express’ for about a year. Express was the distributor of the UAE Exchange.Based on the same experience, Dhakal took the proposal to open ‘International Money Express’ (IME) to Rashtra Bank. Dr. NRB, headed by Tilak Rawal, readily accepted his offer and allowed IME to operate.

IME has now become synonymous with remittances. The early days were not easy. IME had to compete with commercial banks doing remittance business.And Dhakal thought, “If we had our own bank or financial institution, remittances could be saved in our own institution, and it would be easier to compete with the big banks.” After much thought, he planned to open a commercial bank.

“We have come to this place today with a focus on state policy, public interest and professionalism.”
Chandra Prasad Dhakal
Chairman, Global IME Bank

At that time, there were only commercial banks headquartered in Kathmandu. “We have applied for the registration of Global Bank with 18 promoters as the head office in Birgunj,” recalls Dhakal. Shortly after submitting the application, NRB changed its policy and allowed the head office to be located in Kathmandu. After that, Global Bank got permission to operate with Kathmandu as its head office.

IME Finance and Global Bank were doing business separately. NRB adopted a policy of merging banks and financial institutions with crush holdings.IME became the first to implement this policy. Immediately IME Finance and Global Bank merged.

Global IME Bank was started in 2012 after the then Global Bank, IME Financial Institution and Lord Buddha Finance merged. Before that, Global Bank was established in 2007 as a ‘A’ class bank.At that time, the Global Bank, which was established with a paid-up capital of Rs. 1 billion, was moving ahead by merging with other institutions and increasing its capital.

Confluence of 18 organizations

Global IME Bank, the country’s largest commercial bank, was already accustomed to merging with other banks and financial institutions. In the 12 years since its inception, the bank has merged with 17 non-IME institutions.

Before becoming the country’s largest commercial bank, Global IME, it has included 17 banks and financial institutions, including two commercial banks. Global IME Bank and Commerce and Trust Bank merged. The remaining 15 development banks and finance companies merged.

Gulmi Development Bank, Social Development Bank, Reliable Development Bank, Pacific Development Bank, Consumer Development Bank, Triveni Development Bank are included in it.Similarly, Dry Development, Bright Development, Public Development and Siddhartha Development Bank have also joined Global.

IME Finance, Lord Buddha Finance, Hand Way Finance, Shubhalakshmi Finance and Nepal Awas Finance are also included in the global.

Also first in the implementation of state policy

Dhakal, who is also the senior vice-president of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), an umbrella organization of the private sector, says that he pays attention to three things while doing any work. The first is state policy, the second is public interest and the third is professionalism.

“My first thought is to follow the policy of the state,” said Dhakal. “We have always been at the forefront of state policy implementation.

He merged IME Finance and Global Bank as soon as the crush holding policy came. NRB to raise capital from Rs 2 billion to Rs 8 billion or on the issue of big merger; It is the first bank to implement state policy.

Chief Executive Officer (CEO) of the bank Ratnaraj Bajracharya also says that he will always be at the forefront in following the policy of the state. He said that the bank will always be at the forefront of good corporate governance and transparency.

Similarly, Deputy Chief Executive Officer (Deputy CEO) Surendra Raj Regmi, who is also in charge of the Bank’s Information Officer, says, We are always in the forefront of expanding branches in rural areas or investing in various directed sectors, providing refinancing to customers, rescheduling and restructuring loans of customers affected by COVID-19.

There has been no big merger of other banks after Global IME. Some of the merged organizations are facing many problems. This confirms that the merger of big banks is not easy.

When financial institutions merge, the main problem is manpower management. After the merger, manpower management becomes challenging as there will be differences of opinion between the employees of the two organizations on various issues.Global IME Bank has also shown efficiency in this.

The financial sector to establish 

Global IME Bank in the financial sector to make the difference between a successful bank. The bank has now become the largest bank in the country in terms of paid-up capital, branch network and other indicators.

“We have created a distinct and unique identity in the industry,” said Regmi, Deputy CEO.

At present, Global IME Bank has a paid up capital reserve of Rs 29.4 billion, a deposit of Rs 283.3 billion, a loan of Rs 242.5 billion and a customer base of 2.7 million.

The bank has more than 3200 direct employees. The number of indirectly employed is also large.The bank is serving its customers from more than 841 service centers including 76 districts in the country and three foreign representative offices abroad.

The bank has 283 branches, 251 ATMs, 260 branchless banking services, 48 ​​extensions and revenue collection counters.

Strategy to spread abroad

Global IME Bank has formulated a strategy to reach from big industrialists to small entrepreneurs as per the slogan ‘Bank for All’. Chairman Chandra Dhakal says that the investment is being made accordingly.

The bank, which has reached 76 districts of Nepal, is planning to expand its branches in the remaining districts in the near future. The bank has made a strategy to expand its network even abroad.

The bank currently has liaison offices in India, the United Kingdom and Australia. Nowadays, branches are being opened in other countries as well, says Chairman Dhakal.

“We all want to invest in a variety of sectors in Nepal,” he said.

Internal plan of the bank

CEO Bajracharya says that work is being done as per the bank’s plan to reduce expenses and increase income. According to him, ‘Vision-2025’ has been formulated and implemented for that. Business ‘digitization’ also falls within this vision.

Accordingly, the bank has a strategy to double its business by 2025 by making the highest use of technology. CEO Bajracharya says that even if the business doubles, the number of employees will not double.

Last year, Global IME Bank was also at the forefront of savings deposit growth. Of the Rs 50 billion increase in deposits, only Rs 25 billion was in savings accounts. Even now, savings deposits are over Rs 102 billion.

CEO Bajracharya said that the savings deposits which reached Rs 104 billion last July are still more than Rs 102 billion despite liquidity problems. He said that the bank is also very good in retail growth.

According to him, the bank has 32 percent in institutional deposits and Rs 262 billion in loans. It has a 40 per cent stake in corporate and 60 per cent in retail. CEO Bajracharya said that they will move forward by making it better.

The bank, which improved its earnings from the LC guarantee last year, has been doing very well since the beginning of this year. CEO Bajracharya said that they are thinking of covering the expenses including salary allowance from the non-fund based income.

“Our business is set to double in the next four years. We plan to cover all expenses from non-fund based income by July 2025,” said CEO Bajracharya.

He said that only 15-20 branches will be expanded in the country. According to him, the business will be doubled by reducing the number of employees by making maximum use of technology, ‘he said. Our advantage increases when the counter staff is converted into a ‘sales force’.

When digital transactions take place, on the one hand, the customer’s fee is reduced and on the other hand, the bank’s manpower expenditure is reduced. CEO Bajracharya says that they are working according to this strategy.

He said Global IME Bank aims to connect one million of its 2.7 million customers to the digital platform this year.

Speaking on the occasion, CEO Bajracharya said, “We want to make every transaction paperless. Even if it is not 100 percent, 80 percent can be made paperless.”

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