Kathmandu. Bankers have suggested that the responsibility of regulating the cooperative sector should be given to the Nepal Rastra Bank. Taking part in the discussion on the bill designed to amend the Nepal Rastra Bank Act-2058 BS in the Finance Committee of the House of Representatives on Sunday, bankers suggested that cooperatives operating banking should be brought under the regulation of Nepal Rastra Bank.
In the meeting, they demanded reducing the cooling period for CEOs of commercial banks to become governors, providing punishment according to the nature of the crime and practical amendments in the banking sector. Nepal Bankers’ Association president Santosh Koirala underscored the need of coordination among the government, private sector and Nepal Rastra Bank to resolve the challenges seen in the banking sector.
He has mentioned in the proposed bill that the cooling period for the CEO to become the governor is two to three years.
He urged the government to amend the existing one not to extend it beyond six months. Chairman Koirala said that bringing big cooperatives under NRB regulation would help resolve the problems seen in the cooperatives sector. He also stressed on the need of appointing three deputy governors in the NRB and appointing one of them from an external expert.
He said that this would be easier to address practical and policy issues of the banking sector.
Rajesh Upadhyaya, senior vice-president of Confederation of Bank and Financial Institutions Nepal (CBFIN), underscored the need to bring cooperatives under NRB’s regulation. He warned that the problems seen in the past could be repeated if the cooperatives doing banking business were kept out of regulation. He said that if the Rastra Bank did not regulate such cooperatives, the cooperatives should not be allowed to carry out banking transactions.
He pointed out the need to categorize punishment according to the nature of the crime while taking action against the banks and financial institutions. He said it would not be fair to treat a matter of general warning or admonishment as a serious offense.
