Kathmandu. There was a time when the name of Nepal Rastra Bank would hold everyone’s head high. Nepal Rastra Bank (NRB) is the only independent regulatory body. No one could have raised many questions about the regulation and supervision of the Rastra Bank.

However, in recent times, serious questions have been raised about the performance of the central bank.

The Central Investigation Bureau (CIB) of the Nepal Police has started dominating the banking sector due to the lack of work to be done by the Rastra Bank and its failure to do its work on time.

However, it is not easy for the Rastra Bank to douse the rumors that the incidents that have taken place from Karnali Development Bank to Prabhu Bank have spread like chaff fire.

The central bank officials did not find that the NPA ratio of Karnali Development Bank has reached 40.85 percent. As a result, the central bank declared Karnali as problematic on December 26, 2081. A total of Rs 4.90 billion was found to have been scammed in the bank.

The then chairman of the board of directors of the bank, Pashupati Dayal Mishra, established Hilsa Investment Pvt Ltd and embezzled Rs 150 million, Rajendra Bir Ray Rs 320 million, Niraj Bikram Shah Rs 150 million, Dinesh Kumar Rawat Rs 150 million, Bed Prakash Singh Thakuri Rs 15 crore and Sushil Kumar Sarki ‘Nepali’ Rs 20 million. Didn’t the founders and office bearers realize that they were misbehaving while issuing the right shares 2 times or did they turn a blind eye? This is a matter of question.

A 3-member team led by the then acting director of the central bank, Bhuwan Singh Basnet, inspected the bank for three days after learning about the problem in Karnali Development Bank. They had inspected the site from May 12, 2018 to May 14. The team didn’t find any major problems there.

Instead, he received an allowance of Rs 100,000 by training the employees of Karnali Development Bank from 8 am to 16:40 pm during the time of leave one month before his retirement on February 19, 2018. Not only this, in the year 2019-02-03 (2075 Magh 2075), Rs 100,000 was deposited in his account. Basnet told the court that he did not know for what purpose the money was deposited.

What did the central bank look at when Karnali Development Bank reached this situation? This question is on everyone’s mind now.

On November 30, the CIB arrested Chief Executive Officer (CEO) of Prabu Bank Ashok Sherchan, Deputy Chief Executive Officer (DCEO) Maniram Pokharel and Chief Loan Officer (CCO) Riwas Shrestha. All three were arrested under the Banking Offences and Punishment Act, 2064 BS, according to the CIB. According to the CIB, they were given loans worth crores of rupees in the name of various companies and it was misused. The police have also arrested Rajendra Shakya, chairman of Guna Airlines, on the charge of misappropriating loan.

KATHMANDU, Nov. 7: A CIB team has found a file of loan misuse that was not found during three on-site inspections by Nepal Rastra Bank (NRB) on November 7. Questions have been raised over the NRB’s on-site inspection after the CIB found the file which was not found by the expert team of the central bank three times. The NRB team had carried out 2 regular and one-time special field monitoring. The CIB has seen that the Rastra Bank has not seen any fault in it.

It is customary for the central bank to send a letter to the CIB for further investigation if it is found that the bank has been involved in banking offences or misappropriation of foreign regulations. However, the NRB has not sent any letter to the CIB regarding Prabhu Bank. However, Guru Prasad Poudel, spokesperson of the NRB, said that the letter has not been sent to the CIB for investigation.

Poudel said that the CIB has been taking advice from the Nepal Rastra Bank (NRB) after arresting the three people. According to sources, the NRB has sent 2 employees as experts to investigate the matter.

Spokesperson Poudel said that some files are seen in the sample base as it is not possible to see all the files during on-site inspection of the bank.

Former Governor of Nepal Rastra Bank (NRB) Dipendra Bahadur Chhetri said that the central bank officials should be honest while conducting off-side or on-site supervision. According to him, it is not an ordinary matter that the NRB employees are experts and capable and they do an on-site inspection to deduct bad loans by 40 percent like Karnali’s.

The central bank officials said that it would be easier to find out if any of the agencies were trying to hide the information if the CIB found it at the same time.

The latest developments have also raised questions on the supervision of the Rastra Bank. Why didn’t the CIB see the file? Complaints have increased that the Rastra Bank is limited to paper somewhere, not like the Rastra Bank in practice. This issue is being discussed within the Rastra Bank.

If the central bank does not strengthen its supervision, it is not only the CIB entering the banking sector but also the CIB is taking political vendetta.

Some former bankers say that the role of the NRB has started to be seen in the role of the NRB due to the lack of strong regulatory bodies, the lack of work to be done by the regulatory bodies, and the failure to look at the files of the concerned departments of the NRB.

The arrest of Prabhu Bank CEO Sherchan is also being taken to give it a political color. A single bench of Patan High Court Judge Prakash Dhungana on November 23 issued an interim order not to arrest Sherchan in civil cases except in criminal cases involving the government.

Sherchan was arrested by the CIB on Sunday. According to CIB Spokesperson Shiva Kumar Shrestha, he was arrested under the Banking Offences and Punishment Act, 2064 BS after obtaining permission from the Patan High Court. However, some police officers claim that this incident can be seen directly related to politics.

Earlier, the CIB had arrested Devi Prasad Bhattachan, the former chairman of the bank and a former lawmaker representing the CPN-UML. He has been released after the court ordered his release. Soon after, the CIB arrested three persons, including the CEO of the bank. The CIB arrested CEO Sherchan without informing the Nepal Rastra Bank (NRB) as he was supported by the UML. The CIB has now investigated 2 NRB employees who were arrested without informing the concerned bodies about the financial transactions.

The private sector believes that the CIB has been terrorizing the banking sector by forging political resistance at a time when there has been a growing demand for a law to impose a cash fine instead of jail for any mistake committed by the private sector for a long time. Some people have said that Manoj KC turned his anger into a bank for not being the police chief. He is also seen as wanting to talk about the fact that the government did not appoint a person who did wrong in the banking sector and did not spare him.