CIB blacklists NB Group

Credit Information Bureau (CIB) today blacklisted NB Group's chairman and family members as they have failed to pay back loans taken from Nabil Bank.

The bureau has blacklisted NB Group’s chairman Jit Bahadur Shrestha, dircetor Laxmi Bahadur Shrestha, managing director Jen Shrestha, Anar Debi Shrestha and Purna Bahadur Shrestha for defaulting on loans taken from Nabil Bank worth Rs 150 million by the NB Group for Kathmandu Recreation Center, Siddhi Ganesh Investment, and Shangrila Investment and a personal loan by Jen Shrestha

Jit Bahadur Shrestha is also the chairman of NB Insurance and board member of Nepal Bangladesh Bank (NBB). Likewise, Laxmi Bahadur Shrestha and Jen Shrestha are also in NB Insurance’s board. All three are now ineligible to hold the positions by default following the blacklisting according to the regulatory guidelines.
Their passports will also be seized by the government to stop them from leaving the country.
The central bank had had also penalised Laxmi Bahadur Shrestha with a fine of Rs 500,000 two months back for his involvement in unlawful borrowing and writing back of loans from Nepal Bangladesh Bank. Following the penalty, he had to step down from the bank’s board.

According to central bank loans worth Rs 20.08 million were provided to former Federation of Nepalese Chambers of Commerce and Industry (FNCCI) then president Chandi Raj Dhakal and Prakash Raj Ghimire without any collateral in the final week of the merger of Nepal Bangladesh Bank with Nepal Sri Lanka Merchant Bank and Finance.
“They had received loans from the finance company a week before the central bank’s final nod to merge with NB Bank. The company violated the banking norms had extended more amount although the loanees had demanded just Rs 20 million.
The Central Investigation Bureau (CIB) under Nepal Police had arrested Nepal Sri Lanka Merchant Bank and Finance Company former directors for loans worth Rs 90 million to Alka Hospital just before the merger with NB Bank.
That left the finance company with no cash and other resources, even affecting the financial health of NB Bank that was slowly emerging from a crisis. Right after the merger, NB Bank’s capital adequacy ratio fell below the required 10 percent as the bank absorbed the liabilities of the finance company worth Rs 800 million. Earlier, a proposal was floated to the board of the central bank for sending the NSLMB into liquidation. “But two NRB directors, whose tenure has recently been completed, refused the proposal that saw the proposal on hold for a month,” said the NRB source.