Kathmandu. Roshan Kumar Neupane has resigned from the post of Chief Executive Officer (CEO) of NIC Asia Bank after a gap of 7.5 years. Neupane had been following an aggressive loan expansion strategy from the very beginning of his tenure. Due to this failure, there was a lot of pressure on him to resign.
Near Neupane’s resignation has not been accepted even though he has been pressured to resign from the post repeatedly. He said he resigned due to family reasons.
Neupane who entered the banking sector as the head of the internal audit department is a Chartered Accountant and has experience in various departments of the bank. Based on this experience, he was appointed CEO for the first term on December 30, 2018.
Initially, under the leadership of Neupane, the employees were enthusiastic and the trust of the customers was awakened and the bank created a positive image in the market. However, in the first term, the bank gave priority to risky and arbitrary loan disbursement. Extended credit in the claim to make the bank a leader later turned into a burden due to a lack of due diligence in financial standards and risk assessments. The bank’s financial statements show that the financial year 2074 The non-performing loan ratio stood at 0.29 percent in the second quarter of 2017-18. However, in a few years, it has increased to 6.28 percent.
At the same time, the bank’s profit has also decreased by 77 percent to Rs 16.15 crore. The bank had posted a net profit of Rs 70.14 crore in the previous fiscal year. It is a serious challenge from the financial point of view that such a big drop in the profit of NIC Asia is when most of the banks increase their profits. This shows the weakness in the internal management of the bank and the failure to control the risk.
Customers have also been worried about the continued poor financial statements and bank failures in recent years. Social media and financial analysts are also questioning whether our deposits in the bank are safe or not.
Following the resignation, the board of directors of the bank has appointed senior deputy CEO Santosh Rathi as the acting CEO of the bank. Experts say Neupane’s tenure is “worse than improved”. The prospect of bank reform now depends on the activism of new leadership, financial discipline and regulatory influence. NRB’s silence in the past, political influence and managerial weaknesses have also delayed the reforms. Neupane had also been accused of covering up the bank’s mistakes by making financial transactions with the directors of the NRB’s regulatory department.
How will the new CEO make the bank stable and credible? What strategy will be put in place to restore customer confidence and financial health of the bank? This question will arise for the new CEO of NIC Asia.
The future decision of NIC Asia now depends on the new CEO and the bank’s internal reform process. If concrete steps and strategies are in place, the bank is likely to be stable and reliable again, otherwise the impact of past mistakes will be felt for a long time to customers and the market.
