Kathmandu. It has not yet been decided who will be the Governor of Nepal Rastra Bank. Even though Maha Prasad Adhikari has left the post of Governor after completing his five-year term, the government has not been able to appoint a Governor yet.
The NRB Act generally requires the appointment of a Governor one month before the vacancy occurs. The Governor Selection Committee was formed a month ago under the leadership of Finance Minister and Deputy Prime Minister Bishnu Prasad Poudel in February, but the committee has not yet been able to select a governor.
According to the National Bank Act, the Governor is responsible for operating and managing the bank within his/her powers, organizing the tasks to be performed by the bank, representing the bank in international organizations and institutions, implementing monetary and foreign exchange policies, and determining the necessary policies regarding the interest rates on deposits and loans in commercial banks and financial institutions.
Determining the necessary policies regarding the interest rates that commercial banks and financial institutions take or give on loans or deposits, formulating a liquidity policy to be maintained by commercial banks and financial institutions, determining the basis of the mandatory reserves to be maintained by commercial banks and financial institutions, It is also the governor’s job to make necessary arrangements regarding the amount, method, conditions, time period and its use.
It is also the governor’s job to determine the conditions related to the adequacy of the capital fund of commercial banks and financial institutions, decide on the procedures and conditions to be adopted while buying and selling gold and other precious metals, determine the service charges for the services provided by the bank, decide on the establishment and closure of branch offices and other offices of the bank as required, establish and close agencies of the bank, make necessary arrangements regarding the development and operation of the bank’s information system, and make necessary arrangements regarding the supervision of commercial banks and financial institutions.
If the governor remains in office for a long time, there is a risk that these tasks will be directly affected. In fact, until the governor is decided, the acting responsibility for running the work has been given to Deputy Governor Neelam Dhungana. Deputy Prime Minister and Finance Minister Poudel has given this responsibility to Dhungana in accordance with Section 27 of the Rastra Bank Act, his secretariat said.
Now, Dhungana will play the role of acting governor until a new governor arrives, but he will not be able to take any decisions that have long-term implications. If such decisions are to be taken, a separate decision must be made by the government to authorize it.
In the past, there is a history of deputy governors taking charge for long periods in the absence of a governor. During the time of Vijayanath Bhattarai, Deputy Governor Krishna Bahadur Manandhar played the role of acting governor for a long period when he was accused of corruption. Bhattarai was later cleared and returned to his post.
At that time, Manandhar was also given the authority to sign new notes, but the government had to make a separate decision for that. Dhungana will be able to conduct the daily administrative and general policy work of the National Bank as the acting governor until a new governor is appointed.
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