Kathmandu. People have billions of deposits in the bank {{TAG_CLOSE_a_33 TAG_CLOSE_strong_32 TAG_OPEN_a_33}}}. Along with deposits, millions of people also have faith in Prabhu Bank. But the bank, which has billions of rupees from the people, has been in the grip of scams, irregularities and controversies in recent times. There are so many cases of fraud in the bank that the highest level of the bank has changed. The former bosses are absconding and some are under the radar of the investigation.
TAG_OPEN_strong_31 The latest action of the Nepal Rastra Bank has taken a serious signal!
The latest action taken by the regulator Nepal Rastra Bank against Prabhu Bank has exposed the extent of irregularities in the bank. The board of directors of the bank has been directed to prepare a reform plan and implement it immediately while the then Chief Executive Officer (CEO) Ashok Sherchan has been fined Rs 500,000 in cash as per Section 100 (2) (c) of the Nepal Rastra Bank Act, 2058.
The misconduct of the bank has been found to such an extent that the bank has refused to rectify the serious deficiencies pointed out in the Comprehensive Site Inspection Report, 2081 BS. The bank, which has repeatedly violated the NRB’s directives on loans, has not maintained adequate loan loss provisions without categorizing loans. The Unified Directive issued by the regulator, 2081 Direction No. 2. It has also been found that there is a discrepancy between the loan details submitted by the bank to the Nepal Rastra Bank and the details received from the bank’s core banking system. In other words, the fact that Prabhu Bank has been submitting fake documents to the Rastra Bank has been exposed.
Bosses, some absconding, some in custody, the rest are busy with statements!
Former CEO of Prabhu Bank, deputy CEO and other senior officials are also absconding. The court has ordered them to be sent to jail for trial. But they are lucky to run away. The bank’s then chief business officer Rashmi Pant is in custody. Rashmi, who was released from jail in a case with a bail of Rs 56 lakh, has been arrested again in another multi-crore scam case. The police are also looking for other senior officials of the bank. Some of the current high-ranking officials in Prabhu are also giving statements to the police.
Operators in controversy!
The dispute over the director of the bank has also been going on one after the other. The current director of the bank, Birkha Bahadur Basnet, has been in controversy for becoming a director from the general group and the promoter group. The central bank itself is saying that it is not possible to do so according to the legal provisions. Ambika Lamichhane, the director of the bank, is also in controversy for giving business to her company. Shareholders had raised serious questions against him in the general meeting.
Ramesh Raj Aryal, who is the director of the bank, is also a controversial person. He was previously a director at Citizens Bank. However, the Nepal Rastra Bank (NRB) had said that his position was illegal and that he would be expelled from the bank’s board of directors. After that, he left the bank. Earlier, Kumari was accused of receiving illegal salary even when she was ousted as the CEO of the bank. After the allegations were confirmed, the Nepal Rastra Bank had directed him to return his salary worth millions of rupees. He became the director of the bank by returning his salary as per the directive of the Nepal Rastra Bank.
Internal factional game has not stopped!
The game of factionalism has not stopped in the bank even now. The bank’s Chief Business Officer Ramesh Kumar Shrestha has been transferred to Dhangadhi with effect from Monday. Shrestha claimed that Dipendra Bista and Rabindra Dhakal, who had come from the then century bank, were involved in his transfer. He accused Dhakal of being close to the CEO and Bista of ‘politics’ against him to get the post of CBO. However, Dhakal, who is also the information officer, did not want to comment on the matter.
The challenge of preserving trust amid regulatory pressure
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There have been many scams in many branches of the bank. Some of the scam cases are sub judice. There is a dispute in the board of directors. The mischief of the old bosses is making it difficult for the new CEO to run the bank. The bank is pushing some of the businessmen who are said to be bankrupt to repay the loan. Meanwhile, Nepal Rastra Bank (NRB) has already taken action against the banks pointing out various shortcomings during the inspection. At the same time, issues related to internal management, board of directors, staff transfers and regulatory compliance have put more pressure on Prabhu Bank.
