KATHMANDU, JAN 15 - Finance Minister Surendra Pandey has said that the appointment of the new governor will take place in a methodical way and that merit would be the first priority in the appointment process.

"The candidate's academic credential and managerial leadership will be looked upon," said Minister Pandey while speaking at an interaction organised by Independent Business News on Thursday. Incumbent Governor Bijaya Nath Bhattarai's term is expiring on Feb. 1.

"We can form a panel of experts or adopt other procedures to appoint the new governor," said Minister Pandey, who also heads the three-member committee to recommend the new governor.

On liquidity crisis, Pandey said that NRB was seriously working out to rescue the economy from the liquidity crisis and record high deficit in Balance of Payment (BoP) at Rs. 20 billion.

Banks have been facing liquidity crunch for the last three months and the situation has not improved despite central bank pumping around Rs. 20 billion in the banking system. The minister termed the liquidity crisis as a temporary phenomenon, which he said will be resolved within the next two months.

"There are of course problems in the economy but not as alarming as it has been blown up," said Pandey. He said that the central bank has taken various measures to restrain the liquidity crunch and mitigate other emerging problems in the banking and financial sectors.

According to Pandey, NRB was monitoring on insurance companies after it appeared that there has been capital flight because of people's growing attraction to buy insurance policies of foreign insurance companies.

Likewise, the central bank is also taking stock of gold transaction. "Real estate, cooperatives and inter-banking interest rate are sensitive issues the NRB is looking at currently," said Pandey.

He said that the government was making a specified study to tackle the impact of global recession in the remittance sector.

Ashok Rana, Chief Executive Officer of Himalayan Bank Limited said that the new governor should not be appointed on the basis of one's political leaning.  The Cabinet meeting on Wednesday appointed Bhola Chalise and Ganesh Bahadur Thapa as members of the Governor Recommendation Committee headed by the finnce minister.

 

Posted on: 2010-01-17 01:01

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