Saturday, December 21, 2024

NRB policy meant to strengthen banking sector: Governor Adhikari

Kathmandu, Dec. 19

Governor of the Nepal Rastra Bank (NRB), Maha Prasad Adhikari, has said that the policy implemented by the Nepal Rastra Bank (NRB) aimed at strengthening the banking sector in Nepal and they were not intended to create trouble in the industry. 

Speaking at the Annual Meeting of the Nepal Bankers' Association (NBA) on Wednesday evening, he said that the banking sector in the country is more transparent than any other sector of business.

Governor Adhikari also expressed hopes that the banking business will witness good days in the days to come.

He refuted the banks' statement that they couldn't distribute dividend due to the policy of the central bank and said that the distribution of dividend is based on the capacity of the individual company.

"The NRB accords priority to the financial stability in the country rather than micro-managing the banks and financial institutions," he stated.

According to Governor Adhikari, since there is sufficient liquidity in the financial system while the financial indicators are also good, there is no serious threat to the industry. However, increasing non-performing loan portfolio has created risks to the BFIs so they need to pay more attention to credit recovery, he said.

The annual meeting has elected a new working committee of the association of the 20 class 'A' commercial banks in the country under the leadership of Santosh Koirala, Chief Executive Officer of Machhapuchchhre Bank Limited. He was serving as the Vice-President of the association.

Likewise, Surendra Ragmi, CEO of the Global IME Bank Limited, is elected as the Vice-President. Members of the NBA are Tilak Raj Pandeya of Nepal Bank, Ram Chandra Khanal of Kumari Bank, Ashok Sherchan of Prabhu Bank, Nischal Raj Pandey of Sanima Bank, Sanjeev Manandhar of Prime Commercial Bank, Sundar Prasad Kandel of Siddartha Bank and Sudesh Khaling of Everest Bank.

Immediate Past President Sunil KC will remain as an ex-officio member in the working committee while Ashok Shumsher JBR and Gyanendra Prasad Dhungana are the advisors.

Outgoing President of the NBA, Sunil KC, highlighted the contribution of the banking sector to the national development and financial inclusion with the expansion of branches to all 753 local units. He appreciated the role of the NRB in timely regulation which resulted in the BB- in the sovereign country rating.

"However, political instability, economic slowdown and decreasing credit demand has negatively impacted the banking industry. Quick fluctuations in the liquidity has also posed threats to the stability of the financial system," said KC.

 Published in The Rising Nepal daily on 20 December 2024.   

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