Section 9: Allotment of Shares

1) The bank or financial institution shall set aside at least thirty percent share of its total issued capital for subscription by the general public.

Explanation: For the purpose of this section, “general public” means natural person.

2) The shares allotted to the general public pursuant to sub-section (1) shall be sold to the general public within the stipulated time. The shares that could not be sold in such a manner may be sold to other firms, companies or institutions.

3) The bank or financial institution may allot 0.5% shares, except that of the limit referred to in sub-section (1), to its employees.

4) The bank or financial institution may, if it desires, convert the shares to ordinary shares, having fulfilled the process specified by the Rastra Bank subject not to the share ownership of the promoter shares group less than 51 percent.

Explanation: For the purpose of this Chapter,-

(a) “Promoter shares group” means the promoter shares group as prescribed by the Rastra Bank.

(b) “Ordinary shares group” means the shares groups other than the promoter shares group.

5) Notwithstanding anything contained in sub-section (1), the ratio of share ownership is not necessary in the case of the bank or financial institution and infrastructure development bank to be incorporated under significant ownership of the Government of Nepal.

6) The bank or financial institution to be incorporated in a joint venture with a foreign bank or financial institution or other foreign institution or infrastructure development bank shall have to allot the shares to the general public as specified by the Rastra Bank.

7) While calling upon application from the general public for the subscription of its shares, every bank or financial institution shall demand payment of a hundred percent amount of the face value of its shares along with the application.