The Bank Supervision Department of Nepal Rastra Bank has taken regulatory action against three Class 'A' commercial banks during the fourth quarter of FY 2025/26 (2082/83 BS) for violating regulatory directives.
According to the central bank, Rastriya Banijya Bank was issued a warning for failing to freeze bank accounts within the prescribed timeframe, in violation of the Bank Account Freeze and Release Regulation, 2081.
Similarly, Agricultural Development Bank was warned after a special on-site inspection found that it did not promptly freeze bank accounts despite requests from Nepal Rastra Bank and law enforcement agencies, contrary to regulatory requirements.
Meanwhile, Prabhu Bank faced stricter supervisory measures after the central bank found that significant deficiencies identified in previous inspections had not been adequately addressed. Nepal Rastra Bank required the bank's Board of Directors to sign a written commitment to implement corrective actions.
In addition, the bank's former Chief Executive Officer, Ashok Sherchan, was fined NPR 500,000 for repeatedly violating regulatory directives, including failures related to loan classification, inadequate loan loss provisioning, and submission of loan data that differed from records in the bank's core banking system.
The actions were taken under the provisions of the Nepal Rastra Bank Act, 2058 (as amended) as part of the central bank's ongoing efforts to strengthen regulatory compliance and governance in Nepal's banking sector.
Published by Nepal Rastra Bank on 2083-4-17
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