"We will start distributing the deposits in Kathmandu from February 24. In Pokhara, distribution will start from March 1," said Liquidator and Senior Chartered Accountant Narayan Bajaj. [break]
Under this initiative, a total of 3,391 saving account holders that make up some 98 percent of NDB´s total depositors are getting their money back. For this, the liquidator has provisioned Rs 110 million.
“The fate of the depositors who saved more than Rs 800,000 in the bank would be decided later,” Bajaj told the press.
The payment is being started as a part of the Appellate Court´s order to pay back small depositors. The order was issued about two months ago. NDB had returned a part of the deposits to the petty depositors before the Dashain festival as well. The amount distributed then was close to Rs 30 million.
Bajaj stated that the people having deposits up to Rs 5,000 will be paid in cash, while those holding more than Rs 5,000 will get the account payee checks.
The liquidator further stated that the bank´s outstanding deposit liability presently stands at Rs 720 million. “This figure is exclusive of interest payables,” said he.
Once the liquidator clears accounts of small depositors, he will have to decide on the fate of the remaining 60 large individual depositors, whose deposits stand at Rs 70 million, and institutional depositors like Employees Provident Fund (EPF) and Nepal Army that have deposits of Rs 330 million and Rs 180 million respectively.
“If the Nepal Army wish, we will repay Rs 800,000 to it for now,” said Bajaj. However, he said he would not be able to repay any amount to EPF. “That is because EPF´s money is not accounted under ´deposits´. Rather it was moved under different heading two years ago, when the bank failed to pay it,” said Bajaj.
Apart from cash deposits, the bank has non-banking assets worth Rs 140 million, Bajaj stated. It also has good loans worth Rs 170 million and bad loans worth Rs 50 million.
Bajaj added that the bank has deposits of Rs 105 million at Nepal Co-operatives Bank. However, he lamented that the cooperatives has not yet handed over the money to him, even though its repayment period has already matured.
Nonetheless, Bajaj anticipated of receiving half the deposits amount soon. With property worth Rs 10 million at Gorkha Hydro and other assets worth Rs 2.5 million, Bajaj said he hopes to recover a total of Rs 550 million.
Nepal Rastra Bank (NRB) had decided to liquidate the troubled NDB in June 2009 after its five-year long efforts to revive the bank failed owing to incompetent and defiant management. With the Appellate Court endorsing its decision, NDB has become the first bank to be liquidated in the history of Nepal.
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