Suman Sharma Appointed CEO of Prabhu Bank

Prabhu Bank has appointed Suman Sharma as its Chief Executive Officer (CEO) for a four-year term.

A meeting of the bank’s Board of Directors held on Tuesday, February 3, decided to appoint Sharma to the post, effective the same day.

Sharma’s appointment came the same day as the resignation of Ashok Sherchan, who is under investigation for alleged banking offences.

Sharma, a resident of Kageshwori Manohara Municipality–8 in Kathmandu, brings more than two decades of experience in the banking sector. He has previously served as CEO of Machhapuchchhre Bank and the then Sunrise Bank, and as Deputy CEO at Global IME Bank. He began his banking career at Nepal SBI Bank and later spent 10 years at NMB Bank.

Sharma assumes leadership at a challenging time for Prabhu Bank. Senior officials of the bank are under investigation for alleged banking offences, and the bank has been unable to distribute dividends since fiscal year 2021/22.

On November 30, the Central Investigation Bureau (CIB) of Nepal Police arrested then CEO Ashok Sherchan along with two senior officials on allegations related to banking offences. They were later released on attendance bail.

Earlier, the CIB had taken into custody Hemkumar Mahaju, a former shareholder of Prabhu Management Pvt Ltd and an assistant accounts chief, on suspicion of fraud and offences under the Nepal Rastra Bank Act, 2058.

On October 28, the CIB arrested Devi Prakash Bhattachan, a former lawmaker and Chairperson of the Prabhu Group, on charges of misappropriating nearly Rs 980 million from more than a dozen cooperatives. The allegations relate to financial embezzlement involving Prabhu Money Transfer and Prabhu Management Pvt Ltd, which are accused of failing to reimburse cooperatives for remittances already paid out.

Financially, the bank continues to face pressure. As of the second quarter of the current fiscal year, Prabhu Bank’s non-performing loan (NPL) ratio stood at 7.94 percent, up from 5.06 percent in the same period of the previous fiscal year.

Due to the rise in NPLs, the bank has set aside more than Rs 1.45 billion in risk management provisions by the second quarter. This compares with over Rs 814.2 million in the same period a year earlier.

The bank reported a net profit of more than Rs 1.01 billion in the past six months. However, its distributable profit remains negative at Rs 3.35 billion.

Prabhu Bank has a paid-up capital of Rs 23.54 billion and a reserve fund of more than Rs 14.22 billion. Its earnings per share stand at Rs 8.62, while its net worth per share is Rs 146.17.