Introduction

Governor of Nepal is the chairperson of the Board of Directors of the central bank of Nepal known as the Nepal Rastra Bank (NRB). The Governor is responsible to implement the decisions made by the Board of directors of the Nepal Rastra Bank, operate and manage the Bank and systematize the functions to be carried out by the Bank. Further, he is responsible to represent on behalf of the Bank in international organizations and associations and to implement the policies relating to monetary and foreign exchange matters.

The Governor is responsible to formulate necessary policy on rates of interest for deposits and loan with commercial banks and financial institutions and to formulate necessary policies with regard to the rates of interest to be paid by commercial banks and financial institution on deposit and loan or the rate of interest to be charged by them on deposits and loan.

Process of Appointment of Governor of Nepal Rastra Bank

Government of Nepal appoints Governor of NRB on the basis of the recommendation of the Recommendation Committee formed where Minister of Finance acts as the chairperson along with one person from among the former Governors and one person designated by Government of Nepal from amongst the persons renowned in the fields of Economic, Monitory, Banking, Finance and Commercial Law.

The committee will recommend Government of Nepal the list of the names of three persons renowned in the field of economic, monetary, banking, finance, commerce, management, commercial law and from among the Deputy Governors for the appointment of Governor.

Government of Nepal will appoint one person as the Office of Governor out of the names recommended by the formed committee.

Tenure of the Governor of Nepal Rastra Bank

The tenure of the Governor of NRB is of five years and the Government of Nepal may reappoint him for one more term if his previous tenure is satisfactory.

Qualification of the Governor of Nepal Rastra Bank

The person should have the following qualifications in order to be appointed as the Governor of Nepal Rastra Bank:

a) A Nepalese citizen.

b) Have a higher moral character.

c) Have a work experience in economic, monetary, banking, financial and commercial law sectors after having attained at least master's degree in economics, monetary, banking, finance, commerce, management, public administration, statistics, mathematics and law.

d) Other qualifications are:

i) He should not be a member or official of a political party.

ii) He should not be blacklisted in relation to transaction with any banks of Nepal.

iii) He should not be currently engaged in any banks of Nepal.

iv) He should not have five percent or more shares or voting right in any banks of Nepal.

v) He should not be rendered bankrupt for being unable to pay debts to creditors.

vi) He should not be a lunatic person.

vii) He should not be a person convicted by a court in an offence involving moral turpitude.

How the Governor of Nepal Rastra Bank can be removed from the position

The government of Nepal can remove the Governor from his position only in the following cases:

1. If he is disqualified to become a Director of NRB.

2. If he lacks capability to implement the functions which the Bank has to carry out in order to achieve the objectives of the Bank.

3. If he has committed any act causing loss and damage to the banking and financial system of the country.

4. If he is found to have acted dishonestly or with malafide intention in any transaction related to the business of the Bank.

5.  If he his professional license is revoked or prohibited from carrying out any profession rendering disqualified to be engaged in any trade or profession on the ground of gross misconduct.

6. If he is absent for more than three consecutive meeting of Board without a genuine reason.

Government of Nepal can only remove the Governor from his office if an inquiry committee formed by Government of Nepal recommends for his removal. The committee includes the person designated by Government of Nepal from amongst the retired Justices of the Supreme Court as a chairperson and two persons designated by Government of Nepal from amongst renowned persons belonging to economic, monetary, banking, financial, commercial or management sectors as a member.

But the Government of Nepal provides the Governor for a reasonable opportunity to defend himself prior to removing him from his office.

Miscellaneous facts about the Governor of Nepal Rastra Bank

First Governor of Nepal Rastra Bank: Himalayan Shamsher J.B Rana

Present Governor of Nepal Rastra Bank: Maha Prasad Adhikari

Salary of Governor of Nepal Rastra Bank: NPR 4.497 Million in a year.