People's Finance executive chairman on the run

The central bank is seeking police action against People’s Finance executive chairperson Chhabilal Bhusal, who is believed to be on the run from last two days.
The central bank board this evening was forced to take the decision after the finance company today suddenly sought Nepal Rastra Bank’s permission to close daily transaction due to liquidity crunch.
“Due to technical reasons, we have closed our daily transactions today,” People’s Finance chief manager Keshab Prasad Bhattarai told The Himalayan Times.
According to him, one of the technical reasons is liquidity crunch. Its cheques have been bounced lately forcing the company to close its daily transactions.
“We will start operation after our executive chairman Bhusal — who is on leave since last two days — returns tomorrow,” Bhattarai said, without elaborating how will the finance company manage to pay its clients from tomorrow.
The Class C finance company established in 2049 BS was heavily exposed to land and real estate as its loan exposure to the sector is around 60 per cent, according to a source.
A team of central bank today went to the finance company’s headquarter in Tripureshwor, Kathmandu to get the first hand information on its financial status.
“The company — that had distributed 7.5 per cent cash dividend from the profits of last fiscal year — has a liability of around Rs 900 million but it has only Rs 2.5 million cash with it,” according to the primary report.
In the third quarter of the current fiscal year it has reported Rs 6.48 million profits. Its Non-Performing Loan has increased to 3.07 per cent from 2.48 per cent of previous quarter and 2.14 per cent in the same period of the last fiscal year, according to its unaudited report of the third quarter of current fiscal year. “Its CD ratio stood at 88.57 per cent.”
Established in 2049 BS the Class C financial institute has an authorised capital of Rs 1 billion divided into shares of Rs 100 each. It has the paid up capital of Rs 268.8 million. Of the total paid up capital 51 per cent is owned by promoters and rest is issued to the public.
In the last three months the company’s 50-unit of share changed hands through five transactions at the highest price of Rs 225 and lowest of Rs 209 per unit share. According to its unaudited results, its earning per share (EPS) stood at Rs 2.25.

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