28th September 2025, Kathmandu
Sanima Bank Limited’s announcement for its 21st Annual General Meeting (AGM) signals a significant strategic event focused on rewarding shareholders and strengthening the bank’s core capital for future expansion.
Sanima Bank Calls AGM
The proposals to be ratified cover both immediate financial returns through dividends and a forward-looking capital injection via preference shares.
Key Details of Sanima Bank’s 21st AGM
The upcoming AGM is a formal mechanism for the bank’s management to secure shareholder endorsement for its financial results and strategic capital-raising activities.
- Date and Time: Kartik 2, 2082 (October 19, 2025), at 10:00 AM.
- Venue: Amrapali Banquet, Bhatbhateni, Kathmandu.
- Book Closure Date: Ashoj 27, 2082 (October 13, 2025). This date is crucial as only shareholders registered in the bank’s books by the preceding day, Ashoj 26, 2082, will be eligible to attend the AGM and receive the proposed cash dividend.
Core Financial and Capital Proposals
The central elements of the AGM’s agenda revolve around investor returns and capital fortification, ensuring the bank maintains a competitive edge and strong regulatory compliance.
1. Cash Dividend Distribution
The primary proposal for existing shareholders is the distribution of a 7.3685 percent cash dividend, inclusive of all applicable taxes. This dividend payout is a direct reflection of the bank’s profitability in the previous fiscal year and its commitment to providing tangible returns to its investors. The distribution is essential for:
- Enhancing Shareholder Value: Providing a stable and predictable cash return fosters investor confidence and stabilizes the bank’s market reputation.
- Profit Sharing: The dividend effectively shares the bank’s accumulated profits from the fiscal year with its ownership base, demonstrating financial prudence and robust liquidity management.
2. Issuance of Preference Shares
To significantly enhance its regulatory and business capital, the bank is proposing the issuance of NPR 2 billion worth of 8.25 percent non-redeemable, unlisted preference shares. This is a strategic move, often referred to as ‘perpetual non-cumulative preference shares’ in the banking sector, which serves to:
- Strengthen Capital Base: This capital-raising measure directly contributes to the bank’s Tier 1 or core capital, a critical component for meeting capital adequacy requirements set by the central bank, Nepal Rastra Bank (NRB).
- Funding Growth and Expansion: The new capital will bolster the bank’s financial capacity, enabling it to aggressively expand its lending portfolio, support larger projects, and undertake necessary infrastructural or technological upgrades.
- Non-dilutive Common Equity: Preference shares offer a debt-equity hybrid funding option that strengthens the balance sheet without immediately diluting the voting power or earnings per share of existing common (ordinary) shareholders, which is a key advantage for growth-focused companies.
Corporate Governance and Operational Approvals
In line with standard corporate practice and regulatory mandates, the AGM will cover several crucial governance items:
- Financial Statement Review and Approval: Shareholders will formally review and approve the audited financial statements for the preceding fiscal year. This action is the bedrock of corporate transparency, ensuring that all financial reporting is accurate and openly communicated.
- Auditor Appointment: The appointment of external auditors for the current fiscal year and the determination of their remuneration will be finalized. This step ensures that independent, professional scrutiny is maintained over the bank’s financial practices, which is paramount for investor protection and regulatory compliance.
- Election of Directors: The AGM includes the election of three directors from the founder group “A”. This is a key governance function, allowing shareholders to directly influence the composition and strategic direction of the Board of Directors.
- Charter Amendments: The Board will be granted the authority to amend the bank’s memorandum and articles of association. This empowerment is necessary to formalize and implement the key strategic decisions, particularly those related to the issuance of new capital instruments like preference shares, and to ensure ongoing compliance with the dynamic regulatory landscape of the Nepalese banking sector.
Strategic Importance for Sanima Bank
Sanima Bank’s 21st AGM is not merely a procedural event; it is a declaration of the bank’s future trajectory. The combination of a healthy cash dividend and a significant capital infusion through preference shares underscores a balanced strategy: providing immediate value to current shareholders while simultaneously securing the financial foundation for long-term, sustainable growth. The emphasis on electing directors and amending the corporate charter highlights the bank’s commitment to robust corporate governance, a factor increasingly important to both domestic and international investors in Nepal’s highly regulated banking industry. The decisions made at this meeting will directly impact Sanima Bank’s ability to compete, expand its services, and meet the growing demand for financial services in the country.
For More: Sanima Bank Calls AGM