Buoyed by the response to its Voluntary Retirement Scheme (VRS), the oldest Bank in the country– Nepal Bank Limited (NBL)—has re-introduced VRS and is also considering introducing the Compulsory Retirement Scheme (CRS), bank officials said.
Talking to Nepalnews Tuesday, Dr. Tarak Bahadur KC, head, Human Resources of the Bank, said the schemes were being introduced in order to bring the number of staff in the Bank to right size and make it competitive.
According to Bank officials, over 1,600 NBL employees decided to retire voluntarily in response to VR scheme introduced by the Bank over the last year. “This year too we hope to reduce the number of our staff by as many as 1,200 under the VRS,” said Dr. KC.
The total number of employees at the NBL now stands at around 3,600. Of them, over 1,500 are based in the capital valley alone. The bank has its presence in 60 out of 75 districts in the country and provides services even in remote areas through its 116 branches.
NBL officials said they have made the latest VR scheme more attractive compared to the past schemes. “But if the target under the VRS is not met, we will introduce Compulsory Retirement Scheme (CRS) also,” said KC.
Under the CRS, bank staff who haven’t received any promotion despite working at the same post for more than 15 years will be asked to quit their post. Similarly, those who have completed 30 years in service or attained 58 years of age—whichever comes earlier—would also have to quit, as per the new regulations being introduced by the Bank.
“One of the priorities for the new management has been to promote efficiency, reduce overstaffing and provide better and reliable services to our clients,” said Dr KC. “We are also planning to blend new and old employees to meet these goals,” he added.
Under the World Bank-financed Financial Sector Reform Project, the government handed over the management of the loss-making NBL to ICCMT, a consulting firm of the Bank of Scotland in Ireland, nearly two and half years ago.
The new bank management was recently in the news for urging the diplomatic missions based in Kathmandu to deny visas to what it calls ‘wilful bank defaulters.’ As of July 2004, the NBL’s NPA had reached around Rs 9.58 billion (over 34 percent of the total loans disbursed by the Bank.). Of this, the bank has identified loans worth Rs 3.5 billion as non-collectible.
The NBL is now working overtime to realize billions of rupees worth loan that has been classified as ‘bad debt,’ bank officials said.
NBL officials said the new management had also given priority to provide various training to the Bank staff to enhance their efficiency. “The new management has provided training to over 2,700 employees over the last two years or so while only 5,000 staff had undergone training during the previous 15 years,” said Dr. KC. He further said the Bank had worked out plans to provide some sort of training to its additional 1,200 staff over the next two years.
And, the training package would be followed up by what NBL officials say the performance-related reward system. “We are also going for optimum use of information technology,” Dr. KC said.
Known once for a recruiting ground for kiths and kins of powers-that-be, and its lackluster performance, the public-sector Bank seems to be gearing up for competition with the profit-making private sector banks.
But analysts say its ambitious plans would have to be backed by its own powerful trade union and the concerned authorities including the central bank—the Nepal Rastra Bank.