NRB governor says age bar for CEOs, BoDs at BFIs in favour of public
Kathmandu, August 14
A day after the Supreme Court ordered the Nepal Rastra Bank (NRB) not to impose age limits for chief executive officers (CEOs) of banks and financial institutions (BFIs), the central bank’s Governor Chiranjibi Nepal said that the decision to set age bar for Board of Directors (BoDs) and CEOs of BFIs was for the betterment of public.
Addressing the Finance Committee of the Parliament today, Nepal said that as more than 92 per cent of investment in BFIs is from public, it was necessary to set the age limit for concerned bankers. Similarly, he also informed that NRB is yet to receive the formal letter from apex court regarding its Tuesday’s direction on the central bank’s decision.
“Banks are not private properties of BoDs and CEOs, as majority of investment in BFIs is from the general people. Since we have been imposing age limit of 58 years in the public sector to those who have been receiving salary out of taxes paid by the public, why should we not impose age limit to those who have been playing with the money of general people?” questioned Nepal, adding that the age bar decision had been made based on international practice.
Moreover, Nepal lamented that the Supreme Court’s direction on age bar for CEOs and BoDs at BFIs came without consultation with NRB.
The NRB had issued a circular last week barring BFIs from appointing or reappointing CEOs who are above 65 years of age. The new NRB rule had barred CEOs from continuing work in BFIs after crossing 69 years of age. The NRB had set age limit of 70 years for BoDs in BFIs and barred BoDs from continuing in the same capacity beyond 75 years of age.
However, issuing an interim order in response to a writ petition filed by Narayan Das Manandhar, acting CEO of Prime Commercial Bank, against NRB’s decision, a single bench of Chief Justice Cholendra Shumsher JB Rana had ordered the central bank not to implement its decision to fix age limit for BoDs and CEOs of BFIs.
The apex court had concluded that setting the age bar for CEOs and BoDs at BFIs is against the constitutional right of people to be engaged in occupation or employment.
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