Janata Bank Nepal had to persuade retired banker Parshuram Kunwar Chhetri to become its CEO after the post was vacated by Kumar Lamsal as candidates were scarce.

Chhetri left the banking industry more than three years ago, but came back from retirement as they were having a hard time finding someone to take Lamsal’s place.

There are numerous instances where Nepali banks, even those with a history of as long as 30 years, have failed to prepare a successor to the top post. 

This phenomenon exists in the Nepali banking industry because banks do not provide enough exposure to middle level managers, said Prakash Rohera, international corporate trainer and creator of corporate training consultancy The Redwood Edge.

“Instead, decision making power is concentrated at the topmost level without empowering the human resources below them,” said Rohera. 

If this practice continues, there will be times when CEOs will be a rare commodity in the Nepali banking industry in the future, according to Sanjib Subba, CEO of National Banking Institute, a national level apex banking and finance academy.

“Currently, the Nepali banking industry is blessed with a handful of leaders who were groomed during their career at ANZ Grindlays Bank,” said Subba. “I fear that when these CEOs retire, there will be a vacuum in the industry as I don’t see banks focusing on their succession planning.”

Rohera, who has been visiting Nepal frequently for the last seven years, sees enough possibilities for human capital development in the Nepali banking industry. But there is no short cut to succession planning, he added. A successor to a CEO, according to Rohera, is developed through meticulous planning and proper 

grooming. 

“Based on my interaction with them, I can see the fire in young professionals in the Nepali banking industry, and they are ready to go extra miles for their capacity development and be promising bankers,” he told the Post. 

“Now the onus lies on banks to invest in the development of human capital. It is a long-term process and the investment is huge, but it is very important.” This is because organisations don’t give returns, it is human resources that do, he added. 

Nepali banks have gradually started making investments in the development of human capital. Nepal Rastra Bank, the country’s central bank, has asked commercial banks to open at least one branch in each local unit, which means they will have to establish more than 400 branches in total. 

The Nepali banking industry will require at least 2,000 new personnel of different ranks to staff those branches, and banks have geared up to develop the capacity to hire and train them. 

Currently, Rohera is providing ‘training of trainers’ to mid-level staff of Megha Bank Nepal. Raveena Desraj Shrestha, assistant deputy CEO of Megha Bank who is participating in the training, said the bank was ready to recruit people and provide in-house training to meet the demand for fresh staff.