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NEWSLETTER 2072 Volume 1, Issue 1
Tourism Development Bank Limited | Newsletter 2072
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Message from Chairman I feel honored to have this opportunity to celebrate our 6th Anniversary with you all. I believe six years is a major milestone for an institution, as it is for an individual. Throughout our six years journey we have always tried to strive for excellence ensuring financial soundness at all times, even in the most turbulent environment, expanded to 15 branches, increased paid up capital and size of balance sheet along with loan portfolio. I hope in days to come, we will further reflect on how faithful we have been to our vision and mission and write another story of success. On the auspicious occasion of Tourism Bank’s 6th Anniversary, I applaud people who have been prominent on this journey and heartily appreciate our promoters, customers, stakeholders and obviously to the management and staffs who have loyally served the Institution over the years. Lastly, I would like to appreciate the start up of internal newsletter of Tourism Development Bank Limited from its 6th Anniversary which I expect will be an effective medium for communication amongst us.
Prof. Dr. Puspa Raj Kandel Chairman
Tourism Development Bank Limited | Newsletter 2072
“Visuals express ideas in a snackable manner & Good ideas need good strategy to realize their potential.”
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Message from CEO I would like to welcome to this inaugural Newsletter which contains news and information about the activities currently underway in Tourism Development Bank Limited. I appreciate the initiation that has taken as I believe ‘communication’ is the most important key behind the success of any organization. “Effective internal communication not only connects people with one another, but also with the right information at the right time.” Being the first issue, the newsletter attempts to spread word of our activities done throughout the year to the staffs and externals. Effective communication is an essential component of professional success whether it is at the interpersonal, intergroup, intra-group, organizational, or external level and I believe start up of newsletter enhance the communication level of Tourism Development Bank. Further, Newsletter helps to keep employees informed, provide a line-of-sight across the organization and supply the tools and information needed for job productivity. It is the corner stone of communication. Employee newsletter can also be a good way to break down silos within an organization by allowing you to share the activities and news from one division across the wider organization. Although the newsletter format is limited in the amount of in-depth information it can provide, effort have been made to describe, if only briefly, our latest promotional activities, CSR activities, new products launched, articles, banking awareness etc.
“Effective internal communication not only connects people with one another, but also with the right information at the right time."
Through this newsletter, the initiative undertaken during 6th year is circulated. I will just name a few here; the launch of VISA Debit and VISA Travel Cards; the launch of the TDBL Professional Loan; agreement with Nepal Clearing House for NCHL-IPS; a handful of Promotional campaigns focused on growing businesses and brand promotion – all of which were successful; expansion of our new branch in Birgung. We are not just limited to the promotional activities, many CSR activities like donation to Prime Minister Natural Disaster Fund for earthquake victims, distribution of food and utensils to Bal Mandir, an orphanage home based in Naxal, Blood donation program, Cleaning programs and dustbin distribution were successfully performed. I sincerely feel 7th year is going to be another year that will make us be proud once again. From now onwards, quarterly issue of newsletter will be made inviting the articles and information from staffs on regular basis. As the first issue is overall summary of the activities carried during the 6th year, coming issues will try to cover staffs and industry related issues. Enjoy going through this edition of Newsletter. I wish you all the very best.
Mahesh Sharma Dhakal Chief Executive Officer
Tourism Development Bank Limited | Newsletter 2072
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What new we have done? New product development is the continuous process for the retention of existing and attraction of new customers, grow the business, and hit the profit as well as to be the survivor among the fittest in this competitive world. The globalization and technological advancement has completely changed the customer base and need. Everyday people have new demand and to tap changing customer need, new product development has been the back bone of every successful business. In the last few decades, the number of new product introductions has increased dramatically. So to keep up with this pace, Tourism development Bank also upgrades itself with the changing time and technology. TDBL has come up with different new Products during this one year period.
Professional Loan For the extension of Credit to Professionals like Doctor, Engineer, Pilot, Chartered Accountant, Bankers (AM and Above), University Lecturer (Permanent), PhD Holder, Lawyer (LLM), NRB Officers, Govt. Officers, Govt. Owned Corporation/Organization’s Officers and other similar profession for the fulfillment of personal/professional requirements, TDBL has come up with new product TDBL Professional Loan. Under this product, Loan up to Rs.1 Million is granted which can be repaid in an easy EMI basis within maximum of 5 years period. The beauty of this product is professionals no longer have to hassle for the tangible security of loan.
Visa & Travel Card: Being a development bank, Tourism Development Bank Limited (TDBL) has provided competitive service as of “A” Class bank. i.e. TDBL is pioneer in launching VISA Debit card and VISA Travel card. VISA Debit card can be used from any places of Nepal and India whereas VISA Travel card can be used from any visa network around the world. Travelling with VISA Travel card will be trouble- free as traveler will be liberated from the burden of carrying foreign currency. Also, money can be withdrawn easily from any place around the world. Visa Debit Card and Visa Travel card was launched as on date…. Nepal Clearing House Ltd. Interbank Electronic Payment System (NCHL-IPS System): Nepal Clearing House Ltd (NCHL) for Interbank Electronic Payment System (IPS). NCHL shall provide the Interbank Payment System (NCHL-IPS System), which is web based interbank payment solution, which facilitates domestic fund transfer and collection between accounts maintained at different member banks and financial institutions electronically through the secured communication channels between the members resulting in a secure, faster, easier and cost effective access to funds. The Member is granted a limited, non-exclusive, non-transferable perpetual license to use NCHL-IPS System. Member shall be permitted to use NCHL-IPS System and avail of its services only by the “Authorized Users”. With NCHL-IPS, it will be possible to introduce non-paper and non-card based payment and settlement process that will support both direct debit and direct credit instruments. A payment transaction is initiated at the Originating Depository Financial Institution (ODFI) and transferred electronically for exchange and clearing via the secured communication channel to the receiving depository financial institution (RDFI) for necessary processing. NCHL-IPS system is also based on an Application Service Provider (ASP) model by means of re-utilizing most of the infrastructures and processes that are already in place for NCHL-ECC. NCHL anticipates that existing members of BFIs will subscribe to NCHL-IPS system and provided as an extended service to already existing arrangements. It is scheduled to come into operation by March 2016. NCHL-IPS calculates the multilateral net clearing position and sends to the settlement system of Nepal Rastra Bank for settlement of the net clearing position of the direct members. Examples of direct debit transaction are collection of bills, utilities, mortgages/loans, insurance premiums, rents and other regular Similarly 2072 examples of direct credit transactions are OP/PL017-NCHL-IPS Product Tourism Development Bankpayments. Limited | Newsletter Page 3& Pricing Document – For BFIs-Ver 2.0 Public Page - 5 - of 14 payment of bills/utilities, deposit of salary, IPO refund, dividend, social security/pension, tax/revenue, interbank treasury payments, other B2B/B2G payments, etc. It even can facilitate participating banks to introduce multiple channels for its customers to initiate such transactions. Standing order and
TDBL Visa Debit & Travel Card With the strong commitment towards letting our valued customers access their own money in more convenient and secured way, Tourism Development Bank has introduced TDBL VISA Debit Card and TDBL VISA Travel Card for our valued customers on the month of July, 2015. With TDBL VISA Debit Card, you can have the option of making purchases at all VISA accepting merchant locations, cash withdrawal from VISA accepting ATM terminals in Nepal and India and inquire account balances with access to your bank account. TDBL is among the pioneer in launching VISA Debit card. We want our customer to carry confidence not cash, so for enhancing the confidence of our valued customer, we have also introduced TDBL VISA Travel Money, a safer way to carry cash while travelling. With TDBL VISA Travel Money, withdrawal of cash is very convenient from VISA network ATMs all over the world. Make payments to VISA affiliated merchants all over the world with TDBL VISA Travel Money. Avoid the rush on queue for currency exchange and get access to multiple currencies with just one single card. Travelling with VISA Travel card will be trouble- free as traveler will be liberated from the burden of carrying foreign currency. Also, money can be withdrawn easily from any place around the world.
Nepal Clearing House Ltd. Interbank Electronic Payment System (NCHL-IPS System) Tourism Development Bank has signed an agreement with Nepal clearing House Limited for implantation of NCHL-IPS System (Nepal Clearing House Ltd - Electronic Payment System) in January, 2016. It is scheduled to come into operation by March 2016. After the implementation of NCHL-IPS System, bank shall provide the Interbank Payment System to its valued customer, which facilitates domestic fund transfer and collection electronically resulting in a secure, faster, easier and cost effective access to funds.
Tourism Development Bank Limited | Newsletter 2072
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The Member is granted a limited, non-exclusive, non-transferable perpetual license to use NCHL-IPS System. Member shall be permitted to use NCHL-IPS System and avail its services only by the “Authorized Users”. With the introduction of the NCHLIPS both the bank and customers will be benefited as it will be possible to introduce non-paper and non-card based payment and settlement process that will support both direct debit and direct credit instruments. In addition, different functions like collection of bills, utilities, mortgages/loans, insurance premiums, rents and other regular payments, deposit of salary, IPO refund, dividend, social security/pension, tax/revenue, interbank treasury payments, other B2B/B2G payments, etc can be done without more hassles. Further, this system will even facilitate participating banks to introduce multiple channels for its customers to initiate such transactions. This system will provide various benefits to BFIs like an alternative to domestic SWIFT transactions; reduce dependency on cash/ cheques for fund transfers, transaction cost & inherent risks associated with cash/ cheques. Also, it helps in handling large volumes of repetitive payments like dividend payments, salary distribution, pension distribution, etc and faster access to funds thereby improving fund management, Multiple settlements per day can provide near time real time settlement. Lastly, BFIs can gain competitive advantages introducing new products based on the NCHL-IPS.
Deposit Mobilization Scheme (DMS)
The success story of Tourism development bank is growing each day with the rise in customer base, deposit, lending and introduction of new techno-savvy products from its establishment. In order to further enhance the deposit, surge customer base and exceed the current fiscal year’s budget with healthy deposit mix, Deposit Mobilization Scheme has been introduced on July, 2015. Further, the objective of the scheme is to involve all the staff members in growth of the bank’s business and to provide special reward/recognize to those contributing staffs. For the same, achievements will be measured/ rewarded on both the quarterly and yearly basis.
Quarterly Incentive Plan Ranking
First Prize
Second Prize
Third Prize
Cash prize
Rs. 20,000
Rs. 10,000
Rs. 5,000
Yearly Incentive Plan (Bumper Plan) As a bumper prize/ yearly Incentive plan, one employee with highest point collection will be rewarded with the holiday package to Thailand or cash equivalent to that along with the “Letter of Appreciation” from Bank. As on date two winner i.e. for 1st Quarter: Mr. Arjun Gurung (Jomsom Branch) and 2nd Quarter: Ms. Nirmala Barakoti (Gongabu Branch), are already rewarded under the DMS. Tourism Development Bank Limited | Newsletter 2072
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Branch opening at Birgunj In the pursuit of providing banking services to a larger Nepali mass, Tourism Development Bank Ltd. has opened its new branch in the City of Industries, Birgunj. As the business is growing in healthy manner in the region, the newly opened branch will provide exclusive banking services to enterprises- big and small, as well as to the local residents. The newly opened branch provides service of deposit, loan, remittance, check clearing and several other facilities offered by the Bank. With the addition of a new branch, TDBL now has a total of 15 branches throughout the country.
Tourism Development Bank Limited | Newsletter 2072
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Corporate Responsibilities:
Social
CSR, oftentimes, is also described as the corporate “triple bottom line”–the totality of the corporation’s financial, social, and environmental performance in conducting its business. While there is no universal definition of corporate social responsibility, it generally refers to transparent business practices that are based on ethical values, compliance with legal requirements, and respect for people, communities, and the environment.
"Business has a responsibility to give back to
community"
Tourism Development Bank Limited | Newsletter 2072
Within the world of business, the main “responsibility” for corporations has historically been to make money and increase shareholders’ value. In other words, corporate financial responsibility had been the sole bottom line driving force. However, in the last decade, a movement defining broader corporate responsibilities– for the environment, for local communities, for working conditions, and for ethical practices–has gathered momentum and taken hold. This new driving force is known as corporate social responsibility (CSR). In the business community, CSR is alternatively referred to as “corporate citizenship,” which essentially means that a company should be a “good neighbor” within its host community. Today, more and more companies are realizing that in order to stay productive, competitive, and relevant in a rapidly changing business world, they have to become socially responsible. Tourism Development Bank has also taken some initiative to give back something to the society from which it is getting everything.
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Donation to Prime Minister Natural Disaster Fund The earthquake in 12th Baishak, 2072 and aftershock then after has been a nightmare in every Nepalese life. In that incident around 8,800 people lost their life and more than 22,000 people were injured. Further, many have been homeless and orphans after the earthquake. Some of us might have overcome this fear now but still there are many who fought with earthquake, faced the heat, stood strong in rain with empty stomach and who are still living under the open sky with the same circumstances. So, Tourism Development Bank and its staffs had tried to heal their pain to the extent possible by donating Rs. 20,00,000 to Prime Minister Natural Disaster Relief Fund, in presence of Late Prime Minister Sushil Koirala, Chairman of TDBL, Prof. Dr. Puspa Raj Kadel CEO of TDBL, Mahesh Sharma Dhakal and DCEO of TDBL, Manoj Khadka.
Cleaning Program in Thamel Branch From the start of civilization, man has been the only species that cleans its environment, albeit for the sake of survival. Other animal life “foul the nest,” moves out and allows the cycles of nature to produce the waste. So, giving continuity to human civilization, Tourism Development Bank has started its journey of 6th year conducting “Thamel Cleaning Program” with the motto to create awareness regarding cleanliness in our surrounding. The program was inaugurated by Chairman Prof. Dr. Puspa Raj Kadel, CEO Mr. Mahesh Sharma Dhakal, Chief guest Mr. Lilamani Paudel, Dr. Raju Paudel and famous television comedian Mr. Sitaram Kattel (Dhurmus) in presence of local community and TDBL family. In that program, street, shops, drains and nearby areas were cleaned; making local community to understand the importance and effectiveness of cleaning which allows us to live healthy/quality life. We believe for cleaning to be valued—particularly in a business and economic sense—individuals must be knowledgeable and educated about its usefulness and benefits that why awareness regarding the clean environment was also spread during the program.
Tourism Development Bank Limited | Newsletter 2072
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Blood Donation Program The annual day program was not limited to “Thamel Cleaning Program” only. On that day Blood Donation Program with the support of Red Cross Society was also organized having the motto "Safe blood donation is life donation." So, "Give blood save life." Blood donation is a voluntary procedure. You agree to have blood drawn so that it can be given to someone who needs a blood transfusion. We believe that despite our entire medical advances, there is no good man-made substitute for human blood – this is why blood donations are so important and we tried to make little contribution in saving precious life of people. The program was successful with the donors of around 200. People donating blood were feeling great and they had views like Blood donation gives a proud feeling of touching someone's life in such a beautiful way, It's an experience that no words can define, by keeping the blood line flowing, you will greatly contribute towards a healthier, happier society, it is such a wonderful feeling being able to help doctors save human lives etc. World Blood Donor day is celebrated every day on 14 June.
"A spider bite might not transform you into a superhero, but a small needle prick and a little of your time sure can" Tourism Development Bank Limited | Newsletter 2072
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CLEAN CITY, City Sanitation Program & Dustbin Distribution Tourism Development Bank has supported 20 PC Dustbin for dust management of the Siddhicharan Municipality, Okhaldhunga on 28th November, 2015. The Dustbin had been handover at a program with the Slogan CLEAN CITY, City Sanitation Program. The Program is organized by District Police Office, Hotel Association Okhaldhunga, Indian Retired Army Association and Tourism Development Bank Ltd., Okhaldhunga Branch. The Dustbin is handover to the coordinator of Tole Sudhar Samitee of four different places of the Municipality by Chief District Administrator Officer.
Tourism Development Bank Limited | Newsletter 2072
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Food and Utensils Distribution at Bal Mandir, Naxal UNICEF and global partners define an orphan as a child who has lost one or both parents. In such condition, they make choices solely out of necessity which make them often vulnerable to being brought up in lives of crime, sold off into slavery, sexually exploited, and turned into child soldiers. As Bal Mandir in Naxal is saving at least few children from such vulnerability, we have also lent hands to help orphans at Bal Mandir, Naxal Kathmandu to some extent by denoting food and utensils in presence of CEO and DCEO of Bank. With the denotation of those things we have tried to meet some basic need of children over Bal Mandir.
Staff Motivational Training Everyone is under stress and pressure of some sort for most of their working day and their home life. However when things are piling up and there is not enough time to get through everything these same pressures can become anxiety-making and depressing and can even make you sick. Along with these facts, earthquake of 12th April 2015, following aftershock had created some kind fear and stress among the staff while working. So, to release the physical and mental stress and motivate staffs, Tourism development Bank had organized motivational and stress management training program for inside valley staffs & Directors on June 19, 2015 (Ashadh 04, 2072) by Mr. L.P. Bhanu Sharma at Ghar E Kabab Restaurant, Annapurna Hotel, Durbarmarg. During the program the staffs were motivated to find out the reason behind their stress and utilize the stress positively. To sum up, as per the trainer stress management won't make the things that cause the stress to go away, but it will give people some really useful tools to help them cope and feel better in themselves.
Tourism Development Bank Limited | Newsletter 2072
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Promotional Activities Promotions refer to the entire set of activities, which communicate the product, brand or service to the user. The idea is to make people aware, attract and induce to buy the product, in preference over others. Promotional activities include all the activities carried out by an organization for promoting its brand like advertising on television, radio, websites etc, doing personal selling i.e. Selling the products through sales person or door to door selling etc. For the sake of promotion of brand, market penetration and increase sales of banking products Tourism Development Bank had been also participated in many promotional activities.
Participation at Rastriya Byapaar Mela Tatha Maacha Mahostav - 2072, Dhading Tourism Development Bank had shown its participation in National Trade and Fish Festival 2072” in Malekhu, Dhading as an official partner which was organized from 9th -19th Poush, 2072 by Nepal National Commerce Association, Dhading. Being the partner we have tried to promote the local product of the area as well as brand image of Tourism Bank among the mass. In the program we had distributed brochures; banners were placed at different place. In addition, bank’s staffs were there to create banking awareness among the visitors. Further, for the higher market penetration tickets of festivals were printed including advertisement of TDBL’s different products as trade shows are a bonanza of sponsorship opportunities. To sum up, the festival was guided with the motto “Promotion of Domestic Industry, Agriculture, Hydropower, Tourism and Economic prosperity is our campaign.” to promote and enhance social and economic, industries, trade, agriculture, tourism, education and health sector’s.
Tourism Development Bank Limited | Newsletter 2072
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Holi Hangama TDBL was the banking partner in Holi Hangama Program organized in March, 2015 at Bhupu Sainik Bhawan organized by Radio Kantipur. The celebration started with the felicitation of Nepal’s national cricket team. Participants of the festival marked the “Holi Hangama Utsav” with much gusto, smearing colors among themselves and exchanging good wishes. Singers, including Promod Kharel, Himal Sagar Gautam and Rajesh Payal Rai, Jyoti Gurung sang their numbers for around two hours. The event was attended by our CEO, DCEO, Management team and TDBL’s staffs along with Kantipur Media Group Chairman, MD and other. The event was aired by Kantipur FM, Kantipur TV and Kantipur Gold.
Tourism Development Bank Limited | Newsletter 2072
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Participation at 2nd NEPSE Corporate Bulls Race-2072, Kathmandu On the 23rd Anniversary of Nepal Stock Exchange (NEPSE), it had organized “2nd Corporate Bull Race-2072” on 2072/09/25 B.S. in which two of our staffs, Mr. Maheshwor Pokharal and Mr. Rajendra Pokhrel were participated. The Race (Marathon) was 5 km starting from Office of NESPE and ending at same point.
Participation at Double Century Taksar Mahotsav 2072, Bhojpur TDBL has participated in "Double Century Yearly Taksar Festival 2072" organized from 1st Falgun to 7th Falgun, 2072 in Bhojpur District. Taksar Baazar is very popular market of Eastern Region before 4-5 decade ago for crafts work and metalwork with high volume of trade. But, since the people residing over there started migrating and the place is in shadow. So, Bhojpur chamber of commerce and industry has taken initiation to promote and share history of Taksar Baazar which will be supportive in Economic, Agriculture, Tourism, Industrial and Local Culture development of that area. Being the part of same society, we had also forwarded our hands for the preservation and Promotion of Taksar Festival. Meantime, the participation also gave us mileage in creating awareness and promoting our Bank’s brand among the visitors in the program.
Tourism Development Bank Limited | Newsletter 2072
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Participation at Sushala Junior Idol organized by Surshala Music Academy as an Official Bank Partner Surshala, a music Academy has organized, a “SURSHALA IDOLJUNIOR 2016” National Level Child Singing Competition to promote importance of music education in Nepal within age group of 7-16 years in Nepal i.e. Kathmandu, Bhaktapur, Lalitpur, Pokhara, Chitwan, Itahari, Butwal and earthquake affected areas.
"Children are jewel of nation and they should be polished from time to time"
Tourism Development bank had been the part of the event by being an official bank of the event. The event has begun with the first audition held at Patan multiple Campus, Lalitpur on 16 th of Magh, and first round of audition in all the area is almost completed. The program aimed at enhancing participant’s sense of SUR- TAAL, SCALE, singing techniques and performance skill along with developing development of confidence among children by providing them opportunity to involve in musical workshop, field visit, artists visit, personality development program and lots of fun programs. The Surshala Idol’s every episode will be broadcasted on national TV , various electronic media, print and social Medias, handouts, flex, boards, advertisements till the end of Grand Finale which will help in promoting our brand as well.
Participation in “Global Money Week” organized by NRB Nepal Rastra Bank (NRB) had organized a rally in the Capital on the occasion of Global Money Week, March 9-17, on 15th March to mark its financial literacy campaign. The rally was started from Basantapur and ended with a corner meet at Balmiki Campus, Exhibition Road. Along with other BFIs, Tourism Bank had also participated in the rally. During the program the NRB governor informed the students that if they develop saving habit from school they could spend their savings for higher education and other requirements. He also urged them to deposit (save) money at formal and reliable financial institutions.
“OUR COUNTRY DOESN’T HAVE MUCH SAVINGS, WHICH IS WHY WE HAVE REMAINED BACKWARD; WE NEED TO SAVE MORE AND THAT SHOULD BE DONE AT A PERSONAL LEVEL.” Ex. NRB Governor Yubaraj Khatiwada.
Tourism Development Bank Limited | Newsletter 2072
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Corporate Governance Principles -Mahesh Dhakal, CEO Corporate governance is a set of relationships between a company’s management, its board, its shareholders and other stakeholders which provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance. It helps define the way authority and responsibilities are allocated and how corporate decisions are made.
Principle 1- Ensuring the Basis for an Effective Corporate Governance Framework The corporate governance framework should promote transparent and efficient markets, be consistent with the rule of law and clearly articulate the division of responsibilities among different supervisory, regulatory and enforcement authorities. Principle 2- The Rights of Shareholders and Key Ownership Functions The corporate governance framework should protect and facilitate the exercise of shareholders’ rights. Principle 3- The Equitable Treatment of Shareholders The corporate governance framework should ensure the equitable treatment of all shareholders, including minority and foreign shareholders. All shareholders should have the opportunity to obtain effective redress for violation of their rights.
Effective corporate governance is critical to the proper functioning of the banking sector and the economy as a whole. Banks perform a crucial role in the economy by intermediating funds from savers and depositors to activities that support enterprise and help drive economic growth. Banks’ safety and soundness are key to financial stability, and the manner in which they conduct their business, therefore, is central to economic health. Governance weaknesses at banks that play a significant role in the financial system can result in the transmission of problems across the banking sector and the economy as a whole. Primary objective of corporate governance should be safeguarding stakeholders’ interest in conformity with public interest on a sustainable basis. Among stakeholders, particularly with respect to retail banks, shareholders’ interest would be secondary to depositors' interest. Organization for Economic Co-operation and Development (OECD), an organization established to promote policies that will improve the economic and social well-being of people around the world, has set forth principles for corporate governance. The OECD’s widely accepted and longestablished principles aim to assist governments in their efforts to evaluate and improve their frameworks for corporate governance and to provide guidance for participants and regulators of financial markets. The OECD Principles of Corporate Governance are:Tourism Development Bank Limited | Newsletter 2072
Principle 4- The Role of Stakeholders in Corporate Governance The corporate governance framework should recognise the rights of stakeholders established by law or through mutual agreements and encourage active co-operation between corporations and stakeholders in creating wealth, jobs, and the sustainability of financially sound enterprises. Principle 5- Disclosure and Transparency The corporate governance framework should ensure that timely and accurate disclosure is made on all material matters regarding the corporation, including the financial situation, performance, ownership, and governance of the company. Principle 6- The Responsibilities of the Board The corporate governance framework should ensure the strategic guidance of the company, the effective monitoring of management by the board, and the board’s accountability to the company and the shareholders. The Basel Committee’s guidance draws from principles of corporate governance published by the OECD. The Basel Committee is the primary global standard-setter for the prudential regulation of banks across the countries. Basel Committee on Banking Supervision provide a framework within which banks and supervisors should operate to achieve robust and transparent risk management and decision-making and, in doing so, promote public confidence and uphold the safety and soundness of the banking system. Page 16
The committee has revised Guidelines on Corporate governance principles for banks in 2015. The revised guidelines emphasize the critical importance of effective corporate governance for the safe and sound functioning of banks. It stresses the importance of risk governance as part of a bank's overall corporate governance framework and promotes the value of strong boards and board committees together with effective control functions. The revised Principles for Corporate Governance for Banks are:Principle 1: Board’s overall responsibilities The board has overall responsibility for the bank, including approving and overseeing management’s implementation of the bank’s strategic objectives, governance framework and corporate culture.
Principle 7: Risk identification, monitoring and controlling Risks should be identified, monitored and controlled on an ongoing bank-wide and individual entity basis. The sophistication of the bank’s risk management and internal control infrastructure should keep pace with changes to the bank’s risk profile, to the external risk landscape and in industry practice. Principle 8: Risk communication An effective risk governance framework requires robust communication within the bank about risk, both across the organization and through reporting to the board and senior management.
Principle 2: Board qualifications and composition Board members should be and remain qualified, individually and collectively, for their positions. They should understand their oversight and corporate governance role and be able to exercise sound, objective judgment about the affairs of the bank.
Principle 9: Compliance The bank’s board of directors is responsible for overseeing the management of the bank’s compliance risk. The board should establish a compliance function and approve the bank’s policies and processes for identifying, assessing, monitoring and reporting and advising on compliance risk.
Principle 3: Board’s own structure and practices The board should define appropriate governance structures and practices for its own work, and put in place the means for such practices to be followed and periodically reviewed for ongoing effectiveness.
Principle 10: Internal audit The internal audit function should provide independent assurance to the board and should support board and senior management in promoting an effective governance process and the long-term soundness of the bank.
Principle 4: Senior management Under the direction and oversight of the board, senior management should carry out and manage the bank’s activities in a manner consistent with the business strategy, risk appetite, remuneration and other policies approved by the board.
Principle 11: Compensation The bank’s remuneration structure should support sound corporate governance and risk management.
Principle 5: Governance of group structures In a group structure, the board of the parent company has the overall responsibility for the group and for ensuring the establishment and operation of a clear governance framework appropriate to the structure, business and risks of the group and its entities. The board and senior management should know and understand the bank group’s organizational structure and the risks that it poses. Principle 6: Risk management function Banks should have an effective independent risk management function, under the direction of a chief risk officer (CRO), with sufficient stature, independence, resources and access to the board. Tourism Development Bank Limited | Newsletter 2072
Principle 12: Disclosure and transparency The governance of the bank should be adequately transparent to its shareholders, depositors, other relevant stakeholders and market participants. Principle 13: The role of supervisors Supervisors should provide guidance for and supervise corporate governance at banks, including through comprehensive evaluations and regular interaction with boards and senior management, should require improvement and remedial action as necessary, and should share information on corporate governance with other supervisors. Source: 1. OECD Principles of Corporate Governance 2. Basel Committee on Banking Supervision, Guidelines, Corporate Governance Principles for Banks
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Which is not a monetary control instrument of NRB? -BAFIA
BANKING AWARENESS Question Set for Banking Exams
The Headquarter of World Tourism Organization is in ……………………….. - Madrid, Spain The largest Island of the world is ………………… - Greenland What is the full form of RTGS in the term of Banking? - Real Time Gross Settlement Which is the first Insurance Company in Nepal? - Nepal Insurance Company Which governing body publishes fiscal policy in Nepal? - Ministry of Finance When was the Nepal Red Cross Society (NRCS) established? - 1963 AD What are the normal Market timings at NEPSE? - 12.00 hours to 15.00 hours What do you mean by the term “KYC” in Banking? - Know Your Customer The term plastic money applies to which of the following? - Various Cards issued by the banks Insurance service provided by the various bank is commonly known as…………………. - Bancassurance In the field of Communication, What is the full form of ADSL? - Asymmetric Digital Subscriber Line Which of the following is the first Commercial Bank in Nepal? - Nepal Bank Limited CAMEL rating is a system that …………… - Assigns a numerical rating to a bank Tourism Development Bank Limited | Newsletter 2072
Which Industry is associated with the term “Basel II”? - Banking Industry Who is the first Governor of Nepal Rastra Bank? - Himalaya Shumser JBR Assurance by the Bank to an exporter that the importer of his goods will pay immediately for the goods ordered by him, is known as……………….. - LC (Letter of Credit) The First established central bank in the world is……………… - Bank of England What do you mean by Disposable Income? - Personal Income minus Direct Expenses What is the full form of OPEC? - Organization of Petroleum Exporting Countries A large scale computer network spread over a span of sizeable geographic area utilizing the telecommunication network is called.................. - WAN (Wide Area Network) When interest and/ or installment of a loan has remained "past due" over 90 days period is known as........................... - Non Performing Assets The system of determining exchange rate of Nepali Rupee with Indian Rupee is called................................... - Pegged Exchange Rate System. A common form of interbank short term borrowing is …………………… - Call Money Page 18
