September 15, 2019 | Investopaper
Banks and Financial Institutions (BFIs) should receive the approval from Nepal Rastra Bank (NRB) regarding the appointment/dismissal of the CEOs.
The government has introduced a bill that requires mandatory consent of the NRB before hiring or firing the CEOs of BFIs.
The policy is introduced in order to intervene the board of BFIs from pressuring the CEOs. Due to the complaints that the board pressure CEOs to provide loans to the people on their recommendation, the government passed the concerned bill.
Previously, the decision regarding the appointment or dismissal of the CEO was in the hands of the board of directors of BFIs.