Nepal Rastra Bank (NRB) on Tuesday froze the bank accounts of directors and senior officers of crisis-ridden Samjhana Finance while its directors have promised to give back up to Rs 10 million to depositors by next Sunday.
During a meeting between company directors and depositors held at the NRB premises an agreement was reached in this regard. The directors will give back deposits by collecting money from themselves as a part of their obligation to inject capital for rights shares to be issued soon.
After the company officials sensed inability to give back deposits on Monday as promised earlier, they kept away from their offices. The company had promised to give 33 percent of fixed deposits and 10 percent of saving accounts. When the depositors reached the company office on Monday, they were shell-shocked to find the senior officials absent.
Their wait for finance officials the entire day went in vain as no official turned up. On Tuesday, they picketed
the Nepal Rastra Bank (NRB) seeking
the central bank’s help for withdrawal of their deposits.
“Protesting depositors and directors of the finance company reached an agreement at the meeting held inside the central bank premise to give back the money to the depositors from directors’ coffer,” said a senior NRB official who participated in the meeting between the two sides. Five directors of the company including its chairman and managing director participated, according to NRB officials. The annual general meeting of the finance company held three months ago had decided to issue rights share on the basis of 1:2 ratio. It means, the directors will collect capital double of their existing shares and that will be used for paying deposits back. While issuing rights shares, the directors should first put money.
After the central bank declared the company crisis-ridden on June 10, it was barred from collecting deposits and providing loans. It should give back deposits on the basis of recovery of good and bad loans and by selling the non-banking assets (fixed assets acquired by banks from the loanees).
The bank was providing deposits back on the basis of maximum Rs 10,000 for savings depositors following the bank being declared crisis-ridden. The fixed depositors had been called to get back their deposits on Monday.
The NRB board meeting on Tuesday also decided to prepare a due diligent report of the finance company. Tirtha Maya Maharjan had deposited Rs 100,000 in fixed deposits and her two sons had deposits of Rs 2000 each in the company. Her sister’s son who is physically challenged has deposits of Rs 14,000 in the company. She had deposited money there because the finance company’s branch was near her house.
Another woman depositor complained that she feared losing deposits of Rs 350,000 deposited by herself and her two sisters in fixed deposits. Her deposits matured in mid-September but the finance company was asking her to wait in the absence of cash.
Anju Tuladhar of New Road failed
to get her money back since May
despite maturity of her fixed deposits. She has Rs 300,000 in fixed deposits. She had managed to get just Rs 20,000 in two times over the period.
Purna Devi Maharjan of Jyatha fears losing deposits of Rs 650,000 deposited by herself, her mother and mother-in-law. Amar Tamrakar of Haugol, Lalitpur has a similar story to tell as he has not got his deposits since last two months. He has Rs. 100,000 in fixed deposits and Rs 60,000 in savings at Samjhana.
Even the employees of the Rastriya Banijya Bank and Nepal Bank have deposited hefty amount of money in the crisis ridden bank. An RBB employee said she was unaware of the company’s status. The company’s financial position is still weak with its capital fund negative at 29 percent lately, according to a senior NRB official. The capital fund was negative 35.04 percent when it was declared crisis-ridden four months ago.
The company has been able to collect around Rs 90 million from loans and non-banking assets after it was declared crisis-ridden, the NRB official said. “ “It has been returning money to depositors as well.” While declaring the company crisis-ridden, the central bank had told it to reduce its non performing loans to below five percent and capita fund to positive by 11 percent as per the requirement of Basel-II within six months.
NRB also directed it to recover all loans that were given without collateral and remained insecure and to allow withdrawal of matured fixed deposits.
news source:ekantipur.com
During a meeting between company directors and depositors held at the NRB premises an agreement was reached in this regard. The directors will give back deposits by collecting money from themselves as a part of their obligation to inject capital for rights shares to be issued soon.
After the company officials sensed inability to give back deposits on Monday as promised earlier, they kept away from their offices. The company had promised to give 33 percent of fixed deposits and 10 percent of saving accounts. When the depositors reached the company office on Monday, they were shell-shocked to find the senior officials absent.
Their wait for finance officials the entire day went in vain as no official turned up. On Tuesday, they picketed
the Nepal Rastra Bank (NRB) seeking
the central bank’s help for withdrawal of their deposits.
“Protesting depositors and directors of the finance company reached an agreement at the meeting held inside the central bank premise to give back the money to the depositors from directors’ coffer,” said a senior NRB official who participated in the meeting between the two sides. Five directors of the company including its chairman and managing director participated, according to NRB officials. The annual general meeting of the finance company held three months ago had decided to issue rights share on the basis of 1:2 ratio. It means, the directors will collect capital double of their existing shares and that will be used for paying deposits back. While issuing rights shares, the directors should first put money.
After the central bank declared the company crisis-ridden on June 10, it was barred from collecting deposits and providing loans. It should give back deposits on the basis of recovery of good and bad loans and by selling the non-banking assets (fixed assets acquired by banks from the loanees).
The bank was providing deposits back on the basis of maximum Rs 10,000 for savings depositors following the bank being declared crisis-ridden. The fixed depositors had been called to get back their deposits on Monday.
The NRB board meeting on Tuesday also decided to prepare a due diligent report of the finance company. Tirtha Maya Maharjan had deposited Rs 100,000 in fixed deposits and her two sons had deposits of Rs 2000 each in the company. Her sister’s son who is physically challenged has deposits of Rs 14,000 in the company. She had deposited money there because the finance company’s branch was near her house.
Another woman depositor complained that she feared losing deposits of Rs 350,000 deposited by herself and her two sisters in fixed deposits. Her deposits matured in mid-September but the finance company was asking her to wait in the absence of cash.
Anju Tuladhar of New Road failed
to get her money back since May
despite maturity of her fixed deposits. She has Rs 300,000 in fixed deposits. She had managed to get just Rs 20,000 in two times over the period.
Purna Devi Maharjan of Jyatha fears losing deposits of Rs 650,000 deposited by herself, her mother and mother-in-law. Amar Tamrakar of Haugol, Lalitpur has a similar story to tell as he has not got his deposits since last two months. He has Rs. 100,000 in fixed deposits and Rs 60,000 in savings at Samjhana.
Even the employees of the Rastriya Banijya Bank and Nepal Bank have deposited hefty amount of money in the crisis ridden bank. An RBB employee said she was unaware of the company’s status. The company’s financial position is still weak with its capital fund negative at 29 percent lately, according to a senior NRB official. The capital fund was negative 35.04 percent when it was declared crisis-ridden four months ago.
The company has been able to collect around Rs 90 million from loans and non-banking assets after it was declared crisis-ridden, the NRB official said. “ “It has been returning money to depositors as well.” While declaring the company crisis-ridden, the central bank had told it to reduce its non performing loans to below five percent and capita fund to positive by 11 percent as per the requirement of Basel-II within six months.
NRB also directed it to recover all loans that were given without collateral and remained insecure and to allow withdrawal of matured fixed deposits.
news source:ekantipur.com
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