11 financial institutions in the action of Rashtra Bank

Action taken against five commercial banks, three development banks and three finance companies in the third quarter

Baishak 22, 2082

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In the third quarter of the current financial year, the National Bank has taken action against 11 financial institutions that were working against the rules. Five commercial banks, three development banks and three finance companies have come under Rashtra Bank's action until January, February and Chait (third quarter) of this year.

Nepal Rastra Bank has taken action against five commercial banks in the third quarter of the current financial year. During that period, Nepal Rastra Bank has taken action against Rastriya Comercial, Kumari, Lakshmi Sunrise, Standard Chartered and Nepal Bank for acting contrary to its instructions.

Among the banks under action, Rashtriya Commercial Bank has not classified loans into micro-monitoring category, has not maintained loan loss system based on loan overdue period and has not followed the rules while calculating the risk weight of some loans, according to the National Bank. The National Bank has also informed that the Chief Executive Officer of the National Commercial Bank has been alerted for not fully complying with some of the provisions in the current capital loan guidelines.

Rashtra Bank alerted the Chief Executive Officer of Kumari Bank Limited for not classifying non-performing loans as per instructions and not maintaining the minimum loan loss system. Rastra Bank alerted the Chief Executive Officer of Lakshmi Sunrise Bank for not classifying non-performing loans as per the rules and not maintaining the minimum loan loss system.

Similarly, the Rastra Bank has stated that the director of Lakshmi Sunrise Bank, a person holding one percent or more of the paid-up capital, the executive head or a member of such person's family or a person who has the right to nominate a managing agent or director, a firm, a company or an organization that has a significant ownership or financial interest in any firm, company or organization is prohibited from providing any kind of loan or facility. The National Bank has warned the Chief Executive Officer that because the current account and current account of the founder of the said bank were being operated in the same bank, the daily balance in the current account remained negative on various dates and provided indirect credit facilities against the rules.

Rastra Bank has taken action against Nepal Bank for failing to effectively implement strategic plans, annual budgets and programs, and failing to make effective identification between budgets and programs and strategic plans. The chief executive officer of the bank has been alerted to the fact that the loan approval and renewal could not be done on time and the employees at the top management level could not be coordinated.

The then Chairman of the Board of Directors of Nepal Bank, Chandra Bahadur Adhikari, has been fined Rs. With this action, the officer has been dismissed from the post of director of the bank.

National Bank has fined Standard Chartered Bank Rs. The National Bank imposed a cash penalty for not maintaining the minimum percentage of lending in the designated areas until the second quarter of the financial year 2081/82.

In the third quarter, Muktinath Bikas Bank, Narayani Development Bank and Salpa Bikas Bank came under Rashtra Bank's action. Among them, the Rastra Bank imposed a cash fine on Muktinath for not maintaining the monthly interest rate within the specified limits, for disbursing low loans in the specified productive sectors (agriculture, energy, micro and small and medium), and for not maintaining the minimum mandatory cash balance. Rashtra Bank Chairman Bharat Dhakal has been warned about these offences.

In the letter given when Narayani Development Bank was removed from the list of troubled institutions, conditions were set to reach the specified paid-up capital within two years, to maintain a limit for collecting deposits from the general public so as not to exceed 100 percent of the paid-up capital, and to maintain a single customer credit limit within the maximum limit of 10 percent of the primary capital.

The Rastra Bank has taken action against the board of directors of the organization for not maintaining the minimum paid-up capital as per the conditions, collecting deposits from the general public in excess of the specified limit, disbursing loans in excess of the single customer credit limit and collecting financial resources in excess of the limit specified in the integrated directive.

"A written order has been issued to the board of directors of the organization to maintain the specified minimum paid-up capital and capital fund ratio until the end of June 2082 and to immediately end the work of violating the regulatory instructions as the instructions given by this bank have been repeatedly violated," said the National Bank. Another financial institution that has been prosecuted is Salpa Bikas Bank. This bank has not maintained the minimum paid-up capital prescribed for 'B' category financial institutions. This is why the National Bank has taken action.

The National Bank has fined Pokhara Finance for not maintaining the minimum mandatory cash ratio. "Since the institution did not maintain the mandatory balance amount to be maintained according to the regulatory provisions from January 13 to 26, 2081, a penalty of 46 thousand 718.23 has been imposed according to the provisions," said the National Bank. Ravichandra Gurung, chief executive officer of Pokhara Finance, has been fined Rs.

'As the institution's non-performing loans were 33.44 percent at the end of December 2081 and the minimum capital fund ratio was not in accordance with the regulatory standards, the institution's financial index has to be maintained within 6 months in accordance with the bank's instructions, and prompt corrective action has been taken by banks and financial institutions,' said the National Bank.

2081 At the end of November, Rastra Bank took prompt corrective action against Janaki Finance saying that the minimum capital fund ratio of the institution was not in accordance with the regulatory standards. Rastra Bank has alerted some members of the Board of Directors, including Gorkhaz Finance Chairman Gaurav Budhathoki, for not filling the post of CEO even for three months.