Two Deputy Governors of Nepal Rastra Bank Retiring Monday, New Appointments Likely After Formation of New Government

Two Deputy Governors of Nepal Rastra Bank — Nilam Dhungana Timsina and Bom Bahadur Mishra — are set to retire from their positions starting Monday as their five-year terms come to an end. With their retirement, two key positions in the country’s central bank will become vacant.

Both officials were appointed Deputy Governors on February 25, 2021 (Falgun 25, 2077 BS). According to the provisions of the Nepal Rastra Bank Act, the tenure of a Deputy Governor is fixed at five years. Despite the approaching retirement date, the process of appointing new Deputy Governors has not yet begun.

Government officials say the delay is largely due to the election code of conduct currently in effect during the ongoing parliamentary elections. The Ministry of Finance, under the leadership of Finance Minister Rameshwar Prasad Khanal, had consulted the Election Commission of Nepal regarding whether the appointment process could proceed. However, to avoid potential controversy or violation of election regulations, the government decided not to move forward with the appointments at this stage.

As a result, the responsibility for appointing the new Deputy Governors is now likely to fall on the incoming government once it is formed after the election results are finalized.

Appointment Procedure

Under the Nepal Rastra Bank Act, the Governor recommends eligible candidates for the Deputy Governor positions from among the bank’s Executive Directors. Legally, the Governor is required to recommend twice the number of candidates for the vacant positions. In practice, however, a shortlist of three names is usually recommended.

The recommended names are submitted to the Council of Ministers through the Ministry of Finance, and the cabinet then selects and appoints two individuals as Deputy Governors.

Deputy Governors are also members of the central bank’s Board of Directors. Their responsibilities include contributing to monetary policy formulation, overseeing the banking system, regulating financial institutions, and supporting macroeconomic stability in the country.

Eligibility Criteria

To qualify for the position of Deputy Governor, a candidate must be a Nepali citizen with high ethical integrity and must hold at least a master’s degree in fields such as economics, monetary policy, banking, finance, commerce management, public administration, statistics, mathematics, or law. In addition, candidates are required to have relevant experience in economic, financial, or banking sectors.

18 Executive Directors in the Race

Currently, all 18 Executive Directors at Nepal Rastra Bank are considered eligible candidates for the Deputy Governor posts. Those viewed as potential contenders include Naresh Shakya, Rewati Prasad Nepal, Ramu Paudel, Bishrut Thapa, Dayaram Sharma, Guru Prasad Paudel, Kiran Pandit, Dr. Satyendra Timilsina, Chet Prasad Upreti, Roshan Kumar Sigdel, Dr. Ram Sharan Kharel, Dr. Dilliram Pokharel, Dirgha Bahadur Rawal, Nishchal Adhikari, Anuj Dahal, Dipak Raj Lamichhane, Rajan Bikram Thapa, and Rajendra Bhattarai.

Sources within Nepal Rastra Bank suggest that some candidates are currently considered stronger contenders than others. Among them are Ramu Paudel, who heads the Bank and Financial Institutions Regulation Department; Dr. Ram Sharan Kharel, Director of the Economic Research Department; and Dirgha Bahadur Rawal, Director of the Bank Supervision Department. Their leadership roles in influential departments have strengthened their standing in the competition.

Other potential candidates include Naresh Shakya from the Microfinance Supervision Department, Rewati Prasad Nepal from the Assets and Services Management Department, and Bishrut Thapa from the Financial Institutions Supervision Department. Additionally, experts in monetary and economic policy such as Dr. Satyendra Timilsina, Dr. Ram Sharan Kharel, Dr. Dilliram Pokharel, and Roshan Kumar Sigdel are also being considered strong candidates.

Limited Lobbying This Time

Unlike previous years, the usual lobbying and internal competition surrounding Deputy Governor appointments appears relatively subdued this time. Employees at Nepal Rastra Bank say this is mainly because the appointment process will likely only begin after a new government is formed.

“In previous years there used to be significant activity and lobbying around the appointment period,” said a bank official. “But this time most discussions are centered on the election results and the formation of a new government.”

Calls for Balanced Representation

Meanwhile, some officials within the central bank have suggested that the new appointments should ensure balanced representation of expertise. They argue that one Deputy Governor should ideally come from a background in monetary and economic policy, while the other should have strong experience in banking supervision and financial regulation.

According to them, maintaining such balance is important for effective policymaking, regulation of financial institutions, and evaluation of economic strategies. Past experiences have shown that lack of balanced expertise can affect the effectiveness of banking supervision and monetary policy decisions.

The Deputy Governor position is also widely regarded as a strong stepping stone toward the position of Governor of Nepal Rastra Bank in the future. Because of its strategic importance, the cabinet traditionally treats the appointment with considerable attention and scrutiny.

With two senior positions about to become vacant, the financial sector is now closely watching who will eventually be appointed once the new government takes office. The decision is expected to have significant implications for Nepal’s monetary policy direction and financial sector governance in the coming years.