Nepal Rastra Bank (NRB), the central bank of Nepal, has immediately withdrawn the Prompt Corrective Action (PCA) previously imposed on Pokhara Finance.

Issuing a public notice on Friday, the central bank confirmed that the restrictions have been lifted following regulatory improvements and a strategic merger agreement.

The NRB had originally penalized Pokhara Finance after supervisory inspections revealed a critical shortfall in the institution's financial health. During an inspection, financial assessments at the end of Poush 2080 and the first quarter of FY 2081/82 showed that Pokhara Finance's minimum capital fund ratio had fallen well below the regulatory requirement after supervisory adjustments. Consequently, on Magh 23, 2081, the central bank enforced disciplinary measures under Clause (c) of Bye-law 3 of the By-laws Related to Prompt Corrective Action of Banks and Financial Institutions.

The decision to lift the corrective action comes on the heels of a approved merger with Samriddhi Finance Company. Following the final approval granted by the NRB committee on Baishakh 17, 2083, the combined financial health of the institution has successfully bounced back to safe regulatory limits.

The projected consolidated financial metrics are as follows:

Based on these improved financial projections, the NRB committee officially decided on Ashadh 10, 2083, to completely revoke the punitive restrictions against Pokhara Finance Limited.