SCB Nepal FPO Granted Grade 2+ Rating from ICRA NEPAL

March 5: Standard Chartered Bank Nepal (SCB) has been granted grade 2+ to the proposed further public offer (equity shares) by ICRA Nepal.  The grade indicates above-average fundamentals to the proposed SCB FPO amounting to Rs 3.3 billion.

SCB is issuing 2,558,140 units of FPO with the face value Rs 100 per unit to be issued to public at Rs 1,290 per unit (including premium of Rs 1,190 per unit). The issue is being made to augment the capital base and meet the revised (higher) paid up capital requirement set by Nepal Rastra Bank (NRB), mentioned ICRA.

The above average fundamental grading factors in the bank’s strong promoter profile (75% subsidiary of Standard Chartered group2 ) along with existence of Technical Services Agreement (TSA) with SCB-UK which ensures strong parental support, group’s oversight and deployment of best practices in SCBNL’s operations. The grading is further supported by bank’s established track record and strong competitive positioning emanating from lowest cost of funds in the industry, said ICRA.  ICRA Nepal also takes comfort from the bank’s ability to maintain healthy asset quality despite general stress in Nepalese economy during FY 2015-16 due to impact of the Apr-15 earthquake and subsequently the customs blockade.