Central bank is going to seek a clarification from the NCC Bank on
why its board should not be dissolved and taken over as the power tussle might
hit the financial health of the bank and send negative message in the financial
market.
Since the daily operation of the bank has also been started being affected
by the tug of war between the two warring sides, "the central bank has to
intervene but it is under discussion on how to intervene," according to a
senior central bank official. "After the board room dispute came out in
public and one group sought the help from the central bank, Nepal Rastra Bank
is, most possibly, seeking clarification on Friday, before taking over. As both
the factions have been blaming each other for corruption and financial
indiscipline, the central bank should also take action to save the financial
health of the bank and and depositors' trust on it."
The board room dispute started after the board split into two
groups favouring NB Group – which has its key members on the run after they
have been booked by the Nepal Police for financial crimes – and Nirmal Pradhan,
a stock investor.
The power tussle that started a year ago, reached the central bank
last week, after some six board members near to the NB Group tendered their resignation
to the monetary authority.
Likewise, the NB Group and Nirmal Pradhan-led group is trying to
get hold of not only Nepal Credit and Commerce Bank – that witnessed its stocks
being traded at Rs 440 per unit today – but also National Hydropower that has
been trading its stocks at around Rs 80 these days due to suspicious
transactions and financial indiscipline by the notorious NB Group.
Nepal Bangladesh Bank –
also promoted by the NB Group – was taken over by the central bank some 10
years ago due to financial indiscipline and bad corporate governance. In recent
years, corporate governance has become a serious issue with the financial
institutions.
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