Kishore Maharjan, CEO, Civil Bank Nepal, has contributed more than two decades of his career in banking sector as a successful banker in Nepal where more than 60% people is out of banking service. In the recently given exclusive interview with Ram S Shrestha of APD, he said that banking is a both charming and challenging job. Excerpts:
For Chinese Banks
Nepal too Small to Invest?
When did you start your banking career?
I started my banking career in 1984 when I was 25 years old and had just completed MBA from Tribhuvan University. My background also helped me to explore my potentiality because my father and aunt were bankers. I worked first for one year in an audit company which had got inter-audit contract with Nepal Bank Limited. I shifted to Rastriya Banijya Bank as an officer in development department, where I formulated project Financing Policy for Rastriya Banijya bank. The first policy I did in Rastriya Banijya Bank is Pepsikola. I financed a spinning mill, Indu-Sankar Sugar mill etc. I worked for Indo-Swiss bank after Rastriya Banijya Bank. I was General Manager in Himalayan Bank in 2007. I established Sun Rise Bank as CEO at first in 2009 and as a CEO I established Civil Bank and quit Sun Rise bank in 2010. I think I am the only CEO in Nepal and in the whole world who established two banks from zero.
What is the condition of public access towards the banking sector, and what are you doing to increase the access?
Nepal has more than 60% people out of banking service. We are doing our best to promote people for banking transection. We are in public institutions. We keep our doors open to everyone who needs our services. We have branches in the remote districts. We accept account in zero balance. We are expanding our coverage in rapid manner.
Do you have to say anything about the state’s policy towards the financial liberalization of the bankers?
We are in free market economy. We can create, price and sell our products freely now. There is too much freedom which causes accidents sometimes. It is not only the problem of Nepal but of the whole world. In 1990 and in 2007, we private sectors and real estate market got crashed. Though Nepal Rastra Bank has not come yet with clear policy, it is a good opportunity to the bankers to have freedom to set up branches abroad. It is not so easy for us because Nepalese banks have very few capitals. We cannot invest that big money in opening branches outside Nepal.
We are controlled by many international standards and parameters. We are following KOIC and strictly enforcing Antimony Laundry Policy.
As agriculture is the main occupation of Nepal, how is your bank offering a good opportunity for easy loan and other facilities to the farmers?
We do portfolio planning. We set our portfolio in different sectors. Nepal Rastra Bank has instructed all banks to invest at least 12 % in energy and agriculture. Civil Bank has almost 7% of portfolio in this sector. We invest in two ways, one is wholesale and another is small size investment. There is also the other way of addressing agriculture field that is through subsidized loan. This subsidized policy is also addressed through our national budget. Our government provides 4% for us when we provide loan in 6% to these sectors. This type of subsidized loan is basically for the youths to promote them in farming.
Is your bank getting benefit from the increasing numbering of Chinese tourists in Nepal?
Many banks are getting direct benefits from the increasing number of Chinese tourists. We have few branches in tourist areas, so I am unable to gain much benefit. The other thing is that Chinese tourists have more faith in the old and established banks in relation to comparatively new banks like ours. New banks do not have much access in China too.
Why Chinese banks are not investing too much in Nepal? What do you think is the main problem for cooperation? What do you suggest them?
Nepal is very small country for Chinese banks. Communication is a major problem I have faced with Chinese banks. Though the big banks have easier communication they do not invest in small countries like Nepal. Nepal is a growing economy, so we are in need of large banks. China can take this opportunity because they have economic capability to invest in large projects. Infrastructure is the first necessity for tourism industry, which is the most booming industry in Nepal. The tunnel project to Hetauda is an example of our low investment capacity. So, I think there is a lot of space for Chinese banks to invest and cooperation in Nepal. They can invest in banking, tourism, infrastructure development, hydropower etc., which need large investment. I am interested to work together with Chinese banks. We are ready to provide shares to Chinese banks.
What is your suggestion for youths who want to enter into the banking career?
Banking is a charming job. Most of the people get impressed by the costumes and the lifestyle of bankers. Banking sector is one of the most stable employers in Nepal. There are a lot of difficulties too. It is very easy for a junior staff but for an officer and other higher level posts, you have a lot of responsibilities. There is an Act in Nepal named ‘Banking Offence Act’ that made us more responsible. We are responsible for each and every fraud that happens during our job period. We bankers are compelled to be highly ethical. I suggest them to be prepared for hard working, loyalty and ready to endure professional pressure before entering banking career.