Nepal Rastra Bank Prohibits Banks from Removing Employees During Branch Consolidation
Summary
Nepal Rastra Bank has barred banks and financial institutions from laying off employees during branch consolidation or merger, and has tied urban branch closures to the opening of new branches in rural wards without banking access. The revised directives also require advance public notice and customer safeguards before any consolidation.
Key Points
- Nepal Rastra Bank has amended its Unified Directives to stop banks and financial institutions from dismissing employees when branches are consolidated or merged.
- Banks closing four branches in metropolitan, sub-metropolitan or municipal areas must open at least one new branch in a rural ward without banking services.
- Branches in rural areas cannot be closed, relocated or merged without prior approval from NRB.
- Customers affected by consolidation must be allowed to repay loans or discontinue services without extra fees, and banks must give 90 days’ public notice before consolidation.
