KATHMANDU, NOV 17 - The Nepal Rastra Bank (NRB) has slapped Rs 50,000 fine on former deputy governor Pushpa Raj Karnikar for his involvement in irregularities during his tenure as managing director at NCC Bank. Karnikar was associated with NCC Bank after retiring from the central bank.
An NRB investigation found Karnikar involved in irregularities while extending two loans—one to a former NRB governor and another to an airline company. According to central bank sources, the former governor was provided loans against cheques that would bounce.
“Despite opposition from subordinates, Karnikar extended the loan without a valid reason,” said the source. However, the bank later took his house as collateral.
As far the loan given to the airline company is concerned, the bank issued good for payment cheques to the company although its account had no balance.
“The bank has told us that it has booked the amount withdrawn through the good for payment cheques as loans,” said the NRB source. “The total size of the loans, under both the cases, stands at Rs 30 million,” said the source.
The central bank’s penalty on Rajkarnikar means he will not be eligible to become a board member of a bank and financial institution for the next three years as per the law.
A few days ago, the central bank had sent a letter to Karnikar, seeking his clarification. “Since the clarification was not satisfactory, we slapped the fine on him.”
The NRB investigation also found that the loans were extended under pressure from directors related to the NB Group, which holds a major stake in NCC Bank.
Meanwhile, the police administration is investigating past irregularities in Nepal Sri Lanka Merchant Bank which has been merged with Nepal Bangladesh Bank (NBB). Both the merchant bank and NBB are promoted by the NB Group.
The Central Investigation Bureau (CIB) even arrested the then executive chairman of the merchant bank Ruby Joshi, Shriram Prasad Lamichhane and Gauri Shanker Chaudhary for banking fraud.
After they said they committed the fraud as per the direction of Laxmi Bahadur Shrestha, a key promoter of the merchant bank, the police are now searching for Shrestha.
The central bank investigation had found the loans extended from Nepal Sri Lanka Merchant Bank before its merger with NBB were under the influence of promoters and are difficult to recover.
Posted on: 2012-11-18 09:10
An NRB investigation found Karnikar involved in irregularities while extending two loans—one to a former NRB governor and another to an airline company. According to central bank sources, the former governor was provided loans against cheques that would bounce.
“Despite opposition from subordinates, Karnikar extended the loan without a valid reason,” said the source. However, the bank later took his house as collateral.
As far the loan given to the airline company is concerned, the bank issued good for payment cheques to the company although its account had no balance.
“The bank has told us that it has booked the amount withdrawn through the good for payment cheques as loans,” said the NRB source. “The total size of the loans, under both the cases, stands at Rs 30 million,” said the source.
The central bank’s penalty on Rajkarnikar means he will not be eligible to become a board member of a bank and financial institution for the next three years as per the law.
A few days ago, the central bank had sent a letter to Karnikar, seeking his clarification. “Since the clarification was not satisfactory, we slapped the fine on him.”
The NRB investigation also found that the loans were extended under pressure from directors related to the NB Group, which holds a major stake in NCC Bank.
Meanwhile, the police administration is investigating past irregularities in Nepal Sri Lanka Merchant Bank which has been merged with Nepal Bangladesh Bank (NBB). Both the merchant bank and NBB are promoted by the NB Group.
The Central Investigation Bureau (CIB) even arrested the then executive chairman of the merchant bank Ruby Joshi, Shriram Prasad Lamichhane and Gauri Shanker Chaudhary for banking fraud.
After they said they committed the fraud as per the direction of Laxmi Bahadur Shrestha, a key promoter of the merchant bank, the police are now searching for Shrestha.
The central bank investigation had found the loans extended from Nepal Sri Lanka Merchant Bank before its merger with NBB were under the influence of promoters and are difficult to recover.
Posted on: 2012-11-18 09:10
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