Proposal on Merger and Acquisition
THESIS PROPOSAL
ON
IMPACT OF MERGER AND ACQUISITION IN NEPALESE FINANCIAL SECTOR FOR A BANK SURVIVAL
BY
SHUSIL RANA
MBA
ID: 5014/2010
KING’S COLLEGE
INTERNATIONAL AMERICAN UNIVERSITY
LA, USA
SUBMITTED TO:
RESEACRH COMMITTEE
KING’S COLLEGE, KATHMANDU NEPAL
INTERNATIONAL AMERICAN UNIVERCITY
LA, USA
May 9, 2012
Title of the study:
"IMPACT OF MERGER AND ACQUISITION IN NEPALESE FINANCIAL SECTOR FOR A BANK SURVIVAL ".
INTRODUCTION:
Commercial banks have an essential role in the economy. One of their main duties is to collect funds from excess fund sectors and lend to customers with insufficient funds. From these financial intermediary activities, they have an important role in determining the amount and distribution of credit in the economy. Since an increase in bank credit leads to increased investment and in turn to increased employment levels, changes in bank lending behaviour have a marked impact on the economic development of the country. Banks change their lending decisions in response to changes in the structure of the banking market. One of the issues arising in this context is bank mergers and acquisition (M&As). Since market structures can change as a result of mergers, bank mergers can have a significant impact on changes in bank lending behavior. Bank consolidation in the form of merger become one of the regulations initiated by the Nepal Rastra bank in order to improve banking system’s capacity to provide financial intermediation between savers and borrowers and restore public confidence. As merger activities around the world have the same purpose, the most common purpose for merger is to increase efficiency and reduce costs.
STATEMENT OF PROBLEM:
At the time when the Nepalese banking sector is going through torment and really tough phase NRB has brought a new merger bylaw believing that it will as a panacea of the entire burning problem and stated it as the need of the hour. This bylaw has been brought into effect by NRB to improve and
ON
IMPACT OF MERGER AND ACQUISITION IN NEPALESE FINANCIAL SECTOR FOR A BANK SURVIVAL
BY
SHUSIL RANA
MBA
ID: 5014/2010
KING’S COLLEGE
INTERNATIONAL AMERICAN UNIVERSITY
LA, USA
SUBMITTED TO:
RESEACRH COMMITTEE
KING’S COLLEGE, KATHMANDU NEPAL
INTERNATIONAL AMERICAN UNIVERCITY
LA, USA
May 9, 2012
Title of the study:
"IMPACT OF MERGER AND ACQUISITION IN NEPALESE FINANCIAL SECTOR FOR A BANK SURVIVAL ".
INTRODUCTION:
Commercial banks have an essential role in the economy. One of their main duties is to collect funds from excess fund sectors and lend to customers with insufficient funds. From these financial intermediary activities, they have an important role in determining the amount and distribution of credit in the economy. Since an increase in bank credit leads to increased investment and in turn to increased employment levels, changes in bank lending behaviour have a marked impact on the economic development of the country. Banks change their lending decisions in response to changes in the structure of the banking market. One of the issues arising in this context is bank mergers and acquisition (M&As). Since market structures can change as a result of mergers, bank mergers can have a significant impact on changes in bank lending behavior. Bank consolidation in the form of merger become one of the regulations initiated by the Nepal Rastra bank in order to improve banking system’s capacity to provide financial intermediation between savers and borrowers and restore public confidence. As merger activities around the world have the same purpose, the most common purpose for merger is to increase efficiency and reduce costs.
STATEMENT OF PROBLEM:
At the time when the Nepalese banking sector is going through torment and really tough phase NRB has brought a new merger bylaw believing that it will as a panacea of the entire burning problem and stated it as the need of the hour. This bylaw has been brought into effect by NRB to improve and