Onus on NRB to improve economy

KATHMANDU: Former governor of Nepal Rastra Bank (NRB) Bijayanath Bhattarai and newly-appointed governor Dr Yubaraj Khatiwada both agree that NRB has its task cut out for it to improve the economy.

Former governor Bhattarai — during his farewell and Khatiwada’s welcome programme organised by NRB Employees Association here today — said that the economy currently is facing the problem of shortage of liquidity, double digit inflation and trade deficit.

“The issue of financial institutions that are showing greedy behaviour by aggressive lending is also a serious concern,” he said adding that due to remittance the economy is leaning towards consumerism. “The people are spending more than they earn,” he added. “The central bank needs to formulate a Monetary Policy that would discourage such tendencies.” Bhattarai also pointed out that since NRB is not fully computerised, economic indicators do not get published on time making the forecast difficult.

New governor Khatiwada said that NRB needs to be courageous and take decisions for the betterment of the economy. “The responsibility of safekeeping Rs 600 billion falls on NRB,” he

said, suggesting the media verify news from NRB’s concerned department before publishing anything about NRB. Both officials showed serious concern over the problem of employee retention in NRB and keeping the house in order.

Central bank issues directive

KATHMANDU: The central bank has issued a directive regarding Anti-money Laundering Act to co-operatives and multipurpose co-operatives involved in savings and credit activities. The Act is to be effective from April 14.

Aimed at preventing the financing of terrorist activities that weaken the economic, social and legal framework of a nation, the Act makes it mandatory for these institutions to provide detailed information about their customers to NRB’s Financial Information Unit (FIU).

“The clients should provide details to the institutions,” FIU said adding that the institutions should report all transactions above Rs 1 million to FIU-NRB within seven days and report suspicious transactions immediately.

Co-operatives and multipurpose co-operatives involved in savings and credit activities should prepare internal regulations, follow these and appoint an implementation officer. If they do not comply with the central bank’s directive, such institutions will be fined or prosecuted according to the Anti-money Laundering Act-2007, it said.

It is expected that the directive will curb unlawful activities, NRB said urging the institutions to cooperate.