SANGAM

Mega Bank soft launching today

SANGAM PRASAIN

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JUL 23 - The much-hyped Mega Bank is making its soft launch on Friday. With Nepal Rastra Bank giving its operating license on Sunday, Mega Bank has become the 28th commercial bank in the country.

Mega Bank is the first five-star bank in the country, said its top management. Its headquarters at Kantipath has a grand look. The old British Council building has been given a complete makeover.

With a paid-up capital of Rs. 1.63 billion, the bank has been in the news for its largest promoter base. It has 1,219 promoters who have invested from Rs. 1 million to Rs. 10 million.

Mega Bank is beginning operations at a crucial time when the banking system is slowly recovering from a liquidity crunch. Real estate, one of the most attractive lending destinations for banks in recent times, is cooling down.

Chief executive officer Anil Shah said that Mega Bank would primarily focus on three sectors -- corporate banking, small and medium enterprises (SMEs) and micro finance. The bank has a specialised team for each of these three sectors.

According to CEO Shah, Mega Bank will not go for real estate and margin lending in the first quarter of its operation. "We'll not lend to real estate and do margin lending in the first quarter," he said.

Shah has an ambitious plan to open 10 branches in its first year of operation. According to him, Mega Bank will have a presence in areas where there are no other banks.

Mega Bank has identified SMEs as one of the core areas for banking. Shah, who was one of the people behind the retail banking revolution in Nepal, believes an SME revolution in the banking sector is about to come.

Mega Bank, according to Shah, will go to rural Nepal with technology as the backbone. "Our aim is not only collecting deposits from rural areas but also issuing loans," he said.

‘We will focus on rural areas’

How will Mega Bank be different from the existing ones?

Our business model is different. We'll be focusing on small and medium enterprises (SMEs) and micro finance. Our focus will be rural areas that is still out of banking services.

As a new bank, don't you think it's challenging to go rural?

Yes, it is challenging; but on the other hand, there is also great opportunity. We'll show that rural Nepal has the most potential for the banking industry for the next three-five years.

How many branches will Mega Bank open in its first year of operation?

As per our plan, we'll be opening 10 branches within the current fiscal year. In the next five years, our plan is to establish around 50 branches.