Finance Company Merger
14th October 2025, Kathmandu
Nepal Rastra Bank (NRB) has officially provided the Letter of Intent (LOI) for the proposed Finance Company Merger between Pokhara Finance Limited and Samriddhi Finance Company Limited.
Finance Company Merger
The central bank issued the in-principle approval on October 13, marking a critical step towards financial industry consolidation.
This merger, initially agreed upon with a preliminary pact on July 20, is expected to create a stronger and more competitive financial institution.
The swift regulatory nod reflects NRB’s policy of encouraging stability and scale within the finance sector.
The Path to Final Approval
With the NRB’s in-principle approval now secured, both financial institutions must accelerate their merger activities. The next crucial phase requires both Pokhara Finance and Samriddhi Finance to convene their respective general assemblies.
They must successfully pass the special merger resolution within the next three months. Following shareholder endorsement, the companies will then submit the final application and all requisite documents to Nepal Rastra Bank for final operational approval.
This disciplined regulatory process ensures that the interests of all stakeholders, including shareholders and customers, remain protected during the Finance Company Merger. It also guarantees compliance with the financial health and governance standards set by the central bank.
Merger Structure and Leadership
The new entity will operate under the name Pokhara Finance Limited, leveraging the established brand equity.
Sources close to the agreement confirm that the merger will proceed at a clean swap ratio of 1:1. This equal ratio reflects a mutual agreement on the valuation and a balanced spirit of the partnership between the two companies.
The governance structure for the merged entity has also been outlined. The current chairman of Samriddhi Finance is slated to assume the chairman position of the unified company.
Furthermore, the selection of the Chief Executive Officer (CEO) will be performance-based. The CEO from either of the two institutions who demonstrates greater contribution to successfully navigating the merger process will be appointed as the CEO of the integrated company once the joint operation commences.
Geographical and Strategic Consolidation
Post-merger, the institution will adopt a two-pronged operational strategy.
The central office will be strategically established in Pokhara, recognizing the company’s regional roots and market strength.
Concurrently, the corporate office will be located in Kathmandu, ensuring an effective connection with the nation’s financial hub and key regulatory bodies.
This strategic geographical presence is designed to capitalize on market opportunities in both the central development region and the strategically important Kathmandu valley.
The consolidation is poised to optimize the branch network, enhance the customer base, and ultimately improve the financial services portfolio offered by the merged entity.
Industry Implications of Consolidation
The merger of Pokhara Finance and Samriddhi Finance contributes to the broader trend of consolidation in Nepal’s financial sector, a key directive of the Nepal Rastra Bank.
Mergers strengthen financial resilience by increasing paid-up capital, reducing operational costs, and fostering efficiency.
For the customers of both Pokhara Finance and Samriddhi Finance, this integration promises enhanced service delivery, access to a wider branch network, and potentially more competitive digital and lending products.
This move underscores the continuous effort to build a stable and robust financial market capable of supporting Nepal’s growing economy. This Finance Company Merger showcases the commitment to a stronger financial landscape.
For more: Finance Company Merger