Police on Monday arrested eight people, including Rajesh Kumar Shrestha, the chairman of the then Century Bank in a banking offence case.

The Central Investigation Bureau of Nepal Police arrested chair Shrestha, board members Sunil Kumar Neupane, Geeta Pradhan, Ramesh Kumar Niraula, Ran Bahadur Shrestha, Rajesh Kumar Dali, Uma Kumari Shrestha and Shiva Gopal Risal from various districts including Kathmandu.

On February 27, police arrested 10 people, including the incumbent senior deputy chief executive officer of Prabhu Bank and former chief executive of the erstwhile Century Bank, on the charge of banking offence for extending loans without adequate collateral from the Century Bank.

Prabhu Bank acquired Century Bank last year.

Manoj Neupane, senior deputy chief executive officer of Prabhu Bank who served as the CEO of Century Bank in 2022 before its merger with Prabhu Bank, and Tulasi Gautam, another former CEO of Century Bank, were among those arrested by CIB. They were later released on the condition of appearing when summoned.

According to police, they were involved in providing loans to various firms owned by Rabindra Chaulagain and other board members of the Deurali Multipurpose Cooperative without adequately valued collateral to provide loans amounting as much as Rs2.11 billion.

The loans were provided to various firms including Puja Trading and Marketing Company; Three Brothers Marketing Pvt Ltd; Puja Marketing Pvt Ltd; and Annapurna Distillery Pvt Ltd against the collateral valued at just Rs1.14 billion. This means that they provided loans exceeding the collateral value by Rs974.17 million, according to the CIB. As per the banking norms, nobody can be provided loans beyond the value of the collateral deposited.