‘Reform of the management structure is necessary to manage the conflict that arises when the same person is a banker and a businessman’
लगानी न्यूज
. KATHMANDU: The Banking Sector Reform Task Force has suggested changing the structure of the Board of Directors of banks and financial institutions to minimize the conflict that may arise when a single person becomes a bank director and a big businessman. According to the task force, the move will increase transparency in the banking system and help protect credit facilities.
{{TAG_OPEN_div_26} The suggestion also mentions that banks and financial institutions should have clear responsibilities division, self-defined rules and monitoring systems. This is expected to contribute to sustainable financial stability and development of customer-friendly banking services.
Similarly, the task force has suggested that a plan should be brought to give special priority to the development of risk-based supervision and customer-friendly banking services by adopting a liberal but prudent approach to banking policies and regulations.TAG_OPEN_div_24
The task force has suggested to the Rastra Bank that the banks and financial institutions should be divided into first, second and third categories and the directives and circulars should be implemented according to the class. Institutions falling in the first category will be given the right of self-regulation and various honors.
The task force has suggested that only information should be provided as per the criteria of Nepal Rastra Bank regarding the opening, TAG_OPEN_div_20 transfer or closure of branches, review of priority sector loans, promotion of green zones and 100 percent currency risk management in foreign investment.
The task force has suggested handing over the price level index processing to the National Statistics Office, ensuring the active participation of stakeholders in policy formulation by removing micro-management, establishing a separate body for the regulation of microfinance and non-banking institutions, among others.TAG_OPEN_div_18
In addition, the task force has recommended that the provisions related to loan classification, loss provisions, non-banking assets and capital funds should be improved in line with international practice.TAG_OPEN_div_16 Initiatives should be taken to strengthen information technology, cyber security and payment systems, protect honest people in banking offenses and ensure punishment to dishonest people.
{{TAG_OPEN_div_14} To promote customer-friendly banking, a uniform structure will be implemented on service charge and interest rates, comparative details will be kept on the website, the documents and deadlines to be submitted by the customers will be clear, and the grievance hearing committee will be effective.
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