Central bank reduces NPA of NB bank to 34 percent

Troubled Nepal Bangladesh Bank (NB Bank) taken over by Nepal Rastra Bank (NRB) saw a reduction of non-performing assets (NPA) to 34 percent from an earlier 41 percent, according to NRB.

NRB has stated that the NB bank has been found successful in recovering the grim situation that the bank was facing.

According to Maha Prasad Adhikari, coordinator of the NRB-led management team, the NRB-led management has been able to recover Rs. 700.3 million during the last two months, which ended on Thursday.

The central bank, on November 12 last year, intervened in the NB Bank and took over the management to protect the depositors from possible financial catastrophe, and deputed a four-member management team to run it.

Following exposure of the bank's difficult financial position, NB Bank saw a 'bank-run', resulting in a massive withdrawal of over Rs 2.24 billion within a week.

According to bank management, Of the total recovery in the last two months, Rs. 463.3 million were recovered from loan investment and Rs. 237 million from NB Group , the main promoter of the bank.

Among the major borrowers, NB Group's loan accounts for Rs 1.76 billion while Momento Apparels and Radiant Fun Fashion Wear of Chandi Raj Dhakal owe over Rs.

421.4 million due with the bank.

The new management team also carried out a due diligence audit of the bank and auctioned off some of the unproductive assets.