Kathmandu. KATHMANDU: The government is to send a representative to the board of directors to secure its investment in Himalayan Reinsurance, a reinsurance company promoted by the private sector.
Although promoted by the private sector, the government has taken ownership of this reinsurance company through the government-owned Rastriya Banijya Bank and Nepal Bank. Both commercial banks are government-owned banks.
Fiscal Year 2081. Nepal Bank and Rastriya Banijya Bank hold 5-5 percent stake in Himalayan Reinsurance. This ownership is the second largest single entity and the largest promoter shareholding in terms of joint venture between the two banks. Although the government investment was significant, neither the commercial bank nor Nepal Bank had representation from the Ministry of Finance in the board of directors.
The government holds 51 percent stake in Nepal Bank and nearly 100 percent stake in commercial banks. The government has invested in a private sector-promoted reinsurance company on behalf of both the banks and has acquired 44.04 percent stake in the government-owned reinsurance company, Nepal Reinsurance Company.
Despite the government’s direct investment and interest, it is evident that the government has committed policy corruption by making Himalayan Reinsurance (HIC) zero representation in the board of directors. At present, the issue of misuse of capital fund and investment of Himalayan Reinsurance is pending at the District, Special and Supreme Court. In all the three cases, founders and directors of Himalayan Reinsurance Company have been accused of misappropriation of investment, money laundering, insurance fraud and banking fraud.
