KATHMANDU: The Patan Appellate Court today issued an order to begin the insolvency process of troubled Nepal Development Bank Limited. It also directed for the return of small depositors’ amount.

The court has appointed an investigating officer in order to find out the bank’s current condition and to begin the process of insolvency.

A division bench of Judges Mohan Prasad Ghimire and Dinesh Kumar Karki gave way out to begin the process of insolvency of the bank as per the

Insolvency Act, 2007. The bench

said that since the Bank could not meet the gap of the loss it has decided to begin the process of insolvency as per section 10 (2) of the Act.

Tirtha Raj Upadhyay, an insolvency expert, has been appointed as the investigating officer to investigate and forward report to the court whether the NDBL could revive or to continue the insolvency process. The bench, however, rejected the Nepal Rastra Bank’s demand to liquidate the bank. Upadhyay is asked to provide report within three months. The bench also directed the troubled bank’s board of directors to call its general meeting.

The NRB had moved the Patan Appellate Court demanding its approval to liquidate the long trouble bank in the first week of July. The then governor

of the central bank, Dipendra

Bahadur Chhetri lodged an application seeking the Patan Appellate Court directives to liquidate the bank citing the NRB’s board of directors’ decision to shut down the bank. The central bank stated that the troubled NDBL had a total loss of Rs 670.87 million.