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Kathmandu Tuesday November 20, 2001 Marga 05, 2058.
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US
company invited to discuss RBB mgmt take-over
Post Report
KATHMANDU, Nov 19 -
The government has finally invited an American consultancy to negotiations over the
management take-over of the ailing Rastriya Banijya Bank (RBB), despite its high quoted
price.
Deloitte Touche
Tohmatsu’s initial bid of US $ 5.9 million for a two-year management contract period
is far higher than the government’s own estimates of US $ 3.2 million. But
nevertheless, it has already been invited for negotiations, officials connected to the
management hand over told The Kathmandu Post today. The company’s nearest competitor
Arther & Anderson had quoted US $ 8.1 million.
A highly placed
source at the World Bank said that Nepal Rastra Bank (NRB) has asked the American company
Deloitte Touche Tohmatsu to reduce its quoted price and make final negotiation for the
contract. However, he also stated that the government is likely to use foreign grants to
make up the difference in amount.
Meanwhile, an NRB
source said that Deloitte Touche Tohmatsu has been invited for the final negotiations on
management hand over of RBB as it quoted the lowest price and has the best proposal among
the bidders.
"After
completing negotiations with the company, we plan to hand over the management of the RBB
within two months," said the source.
The American company
was asked to come forward for final negotiations after the NRB Board approved the proposal
of the company last week. The decision comes at a time when the donor agencies are asking
Nepal to expedite the financial sector reform process.
In the first phase
of the financial sector reform programme, the government had committed to hand over the
management of RBB and Nepal Bank Limited (NBL) to foreign consultants for which the World
Bank has provided US dollars 250 million.
The protracted hand
over of the managements of the RBB and NBL has already delayed Nepal’s entry into the
International Monetary Fund (IMF)-sponsored Poverty Reduction Growth Facility (PRGF)
programme.
The government had invited tenders
from foreign companies for management hand over of the two ailing banks in September 2000.
The government had opted to grant the management of the two banks to foreign companies
after KPMG Barnet, an international auditing firm, declared both banks as technically
insolvent.
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