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Himalaya’s Himalayan turns 25

Wednesday, January 24th, 2018
Photo: Himalayan Bank

Himalaya Rana was honoured for with lifetime achievement at the bank’s 25th anniversary function this week at the Hyatt Regency, Photo: Himalayan Bank

When Himalaya Shumsher Rana returned to Nepal after a stint at the United Nations to establish a joint venture bank in 1983, he probably didn’t imagine that 25 years later Himalayan Bank grow to what it is today: Nepal’s premier pioneering financial institution with a paid up capital exceeding Rs 8 billion with 49 branches all over the country.

At the bank’s 25th anniversary function this week at the Hyatt Regency, Himalaya Rana was honoured for his lifetime achievement. Retired, but also serving as the bank’s chief adviser, he recalled how unique it was in the 1980s for a South Asian financial partnership with Habib Bank of Pakistan.

Chief Executive Officer Ashoke SJB Rana, scion of the founder, praises his father’s pioneering spirit and foresight. It was on the foundations laid down by his father that Himalayan Bank now registers a yearly growth of 12-15%.

The bank receives Rs1.2 billion annually from Nepalis working abroad as remittance, and has distributed Rs6.5 billion to shareholders as dividend. It has also introduced new products like a premium saving account, accidental death insurance, and MasterCard, American Express, Unionpay and JCB credit cards.

However, Nepali banks in general are facing liquidity crunch after the elections in 2017. The growth in real estate transactions shows that although there is money in the market, banks are not being able to cash it as deposits.

“The government consistently spent less than 30% of its total capital within a six year period. This fiscal year it showed only 14% expenditure out of the total capital, which is another reason why banks are facing deficits,” Ashoke Rana explains.

Ever since Nepal Rastra Bank signed the global protocol of Anti Money Laundering, banks have to comply with new international regulations. This means extra budgeting is needed to hire more people to screen all accounts, invest in anti-money laundering software, and other inputs.

“Compliance is the buzz word in the banking sector right now,” says Rana, “and it adds another challenge for Nepal’s financial institutions.”

Another system introduced by the Rastra Bank is the interbank payment system under which banks are to allow customers to pay their utility bills through other banks if they want to.

Himalayan Bank is seizing this moment to introduce a faster payment system and it hopes to allow customers to upgrade banking while at the same time expand its physical branches in the seven new provinces to comply with the central bank’s requirements.

Himalayan Bank is also involved increasingly in lending on infrastructure projects, especially hydropower and the energy sector.

Sikuma Rai



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