Prabhu Bank Former CEO Ashok Sherchan Imprisoned Over NPR 77M Loan Misuse Scandal
7th September 2026, Kathmandu
Former Prabhu Bank CEO Ashok Sherchan has been sent to jail pending trial by the Patan High Court in a landmark banking offense case involving a loan misuse claim of over NPR 77 million. Read the full details on Nepal’s first-ever CEO imprisonment related to banking fraud, regulatory violations, and unauthorized fund usage.
Ashok Sherchan, the former Chief Executive Officer (CEO) of Prabhu Bank, has been sent to jail pending trial in a banking offense case. A division bench of Patan High Court judges, Ganesh Prasad Baral and Raju Kumar Khatiwada, ordered his imprisonment, stating that there are no grounds to assume he is innocent at this stage of the final verdict.
Unlawful Loan Disbursement: Colluding with the borrower while issuing loans related to Janaki Health Foundation, bypassing Nepal Rastra Bank (NRB) regulations, and providing loans without adequate collateral.
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Unauthorized Fund Usage: Utilizing funds from the bank’s parking account without the approval of the Board of Directors.
Claim for Damages: Following a report by the Central Investigation Bureau (CIB) based on an NRB investigation, a case was filed through the Office of the Attorney General. The charges demand a penalty under the Banking Offenses and Punishment Act, 2064, with a claimed principal amount of NPR 7,70,17,701.
This marks the first time in Nepal’s banking history that a sitting or former bank CEO has been sent to jail over a banking offense case.
For more: Ashok Sherchan Imprisoned Over NPR 77M
