Kist Gets New CEO

Kathmandu, Jan. 2 – Kist Bank has appointed a new chief executive, six months after its former CEO resigned following accusations of being involved in insider lending.

The bank’s board has appointed Kumar Lamsal as the new CEO. Lamsal is currently serving as CEO of Sanima Bank. The chief executive’s post of the class ‘A’ commercial bank had been vacant since its former CEO Kamal Prasad Gnawali resigned in June.

For the new CEO Lamsal, reducing the bank’s non-performing loans from the current seven per cent and making the bank profitable will be the major challenges. The bank has been unable to register a profit since the last three quarters. In the first quarter of the current fiscal year, it recorded a loss of Rs 27.4 million. Likewise, Lamsal will also have to work on improving its goodwill among depositors and shareholders that has taken a beating due to the former CEO’s involvement in fund misappropriation.

Gnawali had quit his post following the arrest of his wife on charges of banking fraud. His wife — Gauri Khanal Gyanwali — was arrested by Nepal Police’s Central Investigation Bureau for her involvement in a multi-million rupee scam on business loans from Siddhartha Development Bank. The development bank had provided loans worth Rs 130 million to Jamco Publication backed by collateral of land worth Rs 60 million provided by Gauri Gyanwali.

Kist Bank that was established in 2003 as a finance company was upgraded as a commercial bank in 2009. It was pursuing a merger with Vibor Bikas Bank which came to a halt in November. At present, Prabhu Group —promoter of Prabhu Bikas Bank and Prabhu Money Transfer — has bought a stake in the bank, fuelling speculation of a merger between Kist Bank and Prabhu Bikas Bank.