Nepal Clearing House Ltd. (NCHL) has concluded its 9th AGM today for the fiscal year 2076/77. The meeting was conducted through Zoom online meeting in the presence of the representatives of the shareholders, considering the current pandemic situation.
9th AGM of Nepal Nepal Clearing House Ltd. (NCHL): Overview
The 9th AGM of Nepal Nepal Clearing House Ltd. (NCHL) approved the annual report of the company for the FY2076/77 and increase the paid-up capital to NRs. 411,350,400 from NRs. 298,080,000 through the issuance of a 38% bonus share. The capital has been increased primarily as per the company’s principle of re-investment into additional payment infrastructures; add new products & services, and enhancing risk management systems, corresponding to which NCHL is also planning to implement National Payment Switch. The meeting also decided to approve a 2% cash dividend to cover the tax provisions of the bonus.
Although there has been a noticeable increase in the overall transactions in all the systems provided by NCHL, there is a marked decline in net profit by over 22.2% during the FY 2076/77. The Return On Capital Employed remains at 29% at the end of FY2076/77, which has also declined by over 38%. The decrease in profit is mainly due to downward revision of the transaction fees in almost all systems; cross-subsidizing some of the typical transactions of Government of Nepal & similar institutions; complete waiver of fees during COVID-19 pandemic from 11th Chaitra 2076 till the end of Asar 2077; and fierce competition in the payments market.
The 9th AGM of Nepal Clearing House Limited also elected three members of the Board of Directors representing commercial banks including Mr. Ujjal Rajbhandari (General Manager of Himalayan Bank Ltd.), Mr. Mahesh Sharma Dhakal (Senior Deputy CEO of Global IME Bank Ltd.) and Mr. Srijan Malla (Head of IT of Siddhartha Bank Ltd.).
The earlier members had completed their term. NCHL Board is represented by a member from Nepal Rastra Bank, 3 members from commercial banks, 1 each from development banks and finance companies, with holding pattern of 10% by NRB and 90% by the BFIs.
NCHL processed a total of 20.6 Million transactions equivalent to the settlement value of NRs 9.7 Trillion through its clearing and settlement systems including NCHL-ECC, NCHL-IPS, and connectIPS during the fiscal year 2076/77. There are 63 banks & financial institutions as its direct members with access to over 5,800 bank branches and over 56 non-bank institutions as indirect/technical members within NCHL’s network. NCHL.