KATHMANDU, NEPAL
The Nepal Rastra Bank (NRB) will inform the board of directors concerned about the under-performing chief executive officers (CEO) of the banks and financial institutions. The central bank feels that the financial health of not just the banks and financial institutions but the whole country can be affected as the CEOs will always be involved in their private business and will only serve their personal interest no matter how well they are paid.
NRB will inform the boards of under-performing banks and financial institutions about their CEOs as per the standards set on the basis of supervision by the central bank’s as it does not just raise the cost of the institutions but affects the whole financial sector in the long run. “This has been done as per the regular supervisory role of the central bank,” Deputy Governor Maha Prasad Adhikari stated and mentioned that good governance of the banks and financial institutions has been targeted to make the management more responsible. NRB argues that informing the boards will create an environment like that of surprise inspections and will make the management more responsible.
NRB has evaluated the managerial efficiency of CEOs on the basis of policy directives, operating cost, management of staffers, professional agenda, timely meetings and work-place activities. The central bank has not revealed the names of inefficient CEOs on the basis of those standards but NRB sources claimed that Shovan Dev Pant of Lumbini Bank, Ratna Raj Bajracharya of IME Global, Anil Gyawali of Nabil, Ajay Shrestha and other two are among the better CEOs. NRB officials claim that this provision will allow the boards to know about the supervision of the management and even make necessary interventions.
The central bank earlier had introduced the provision banning the board members from playing a managerial role stating that governance of some banks and financial institutions was weakened due to unnecessary interference of the board members. This provision of informing the boards about the performance of CEOs after separating the roles of promoters and managers is said to have targeted the management heads. The central bank, however, claims that prior information to the boards provided with an aim of not letting the banks and financial institutions fail due to managerial inefficiency will help improve the banks and financial institutions.
Source: Karobar Daily, May 4th 2013
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The Nepal Rastra Bank (NRB) will inform the board of directors concerned about the under-performing chief executive officers (CEO) of the banks and financial institutions. The central bank feels that the financial health of not just the banks and financial institutions but the whole country can be affected as the CEOs will always be involved in their private business and will only serve their personal interest no matter how well they are paid.
NRB will inform the boards of under-performing banks and financial institutions about their CEOs as per the standards set on the basis of supervision by the central bank’s as it does not just raise the cost of the institutions but affects the whole financial sector in the long run. “This has been done as per the regular supervisory role of the central bank,” Deputy Governor Maha Prasad Adhikari stated and mentioned that good governance of the banks and financial institutions has been targeted to make the management more responsible. NRB argues that informing the boards will create an environment like that of surprise inspections and will make the management more responsible.
NRB has evaluated the managerial efficiency of CEOs on the basis of policy directives, operating cost, management of staffers, professional agenda, timely meetings and work-place activities. The central bank has not revealed the names of inefficient CEOs on the basis of those standards but NRB sources claimed that Shovan Dev Pant of Lumbini Bank, Ratna Raj Bajracharya of IME Global, Anil Gyawali of Nabil, Ajay Shrestha and other two are among the better CEOs. NRB officials claim that this provision will allow the boards to know about the supervision of the management and even make necessary interventions.
The central bank earlier had introduced the provision banning the board members from playing a managerial role stating that governance of some banks and financial institutions was weakened due to unnecessary interference of the board members. This provision of informing the boards about the performance of CEOs after separating the roles of promoters and managers is said to have targeted the management heads. The central bank, however, claims that prior information to the boards provided with an aim of not letting the banks and financial institutions fail due to managerial inefficiency will help improve the banks and financial institutions.
Source: Karobar Daily, May 4th 2013
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