Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
A COMPARATIVE STUDY ON CREDIT
MANAGEMENT OF COMMERCIAL BANKS (With Reference to NABIL and SCBNL)
Submitted By:
Narendra Sejuwal Shanker Dev Campus
T.U. Regd. No.: 7-1-327-809-99 Campus Roll No. 402/061
A Thesis Submitted to: Office of the Dean Faculty of Management Sign up to vote on this title Tribhuvan University
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
RECOMMENDATION This is to certify that the thesis Submitted by
Narendra Sejuwal
Entitled A Comparative Study on Credit Management of Commercial Banks (With Reference to NABIL and SCBNL)
has been prepared as approved by this department in the prescribed format of fac of management. This thesis is forwarded for examination.
……………………… Dr. Shilu Bajrachraya
………………………
Sign up to vote on this title
Useful
Dr. Kamal Das Manand Not useful
(Supervisor)
Chief
Shanker Dev Campus
Shanker Dev Campus
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
RECOMMENDATION This is to certify that the thesis Submitted by
Narendra Sejuwal
Entitled A Comparative Study on Credit Management of Commercial Banks (With Reference to NABIL and SCBNL)
has been prepared as approved by this department in the prescribed format of fac of management. This thesis is forwarded for examination.
……………………… Dr. Shilu Bajrachraya
………………………
Sign up to vote on this title
Useful
Dr. Kamal Das Manand Not useful
(Supervisor)
Chief
Shanker Dev Campus
Shanker Dev Campus
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
VIVA-VOCE SHEET We have conducted the viva-voce examination of the thesis presented
By Narendra Sejuwal
Entitled A Comparative Study on Credit Management of Commercial Banks (With Reference to NABIL and SCBNL)
and found the thesis to be the original work of the student written according to t
prescribed format. We recommended this thesis to be accepted in partial fulfillme the requirements for Master of Business Studies (M.B.S.). Sign up to vote on this title
Viva-Voce Committee Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
DECLARATION
I hereby declare that the work reported in this thesis entitled
Comparative Study on Credit Management of Commercial Ba (With Reference to NABIL and SCBNL)" submitted to Shanker
Campus, Tribhuvan University, is my original work. It is done in
form of partial fulfillment of the requirement for the Master of Busin
Studies (M.B.S.) under the supervision and guidance of Dr. S Bajrachraya.
You're Reading a Preview Unlock full access with a free trial.
Download With Free Trial
…….………………………
Narendra Sejuwal
Date :
(Researcher) Roll No. 402/061 Shanker Dev Campus
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
CONTENTS Recommendation Viva-Voce Sheet Declaration Acknowledgement Contents List of Tables List of Abbreviation
CHAPTER – I: INTRODUCTION
1.1
Background of the Study
1.2
Meaning of Commercial Bank
1.3
Brief History of the Evolution of Banking in Nepal
1.4
You're Reading a Preview Credit Management Unlock full access with a free trial.
1.5
Introduction of Sample Organization under study
1.6
Statement of the Download Problem With Free Trial
1.7
Objectives of the study
1.8
Significance of the Study
1.9
Research Methodology 1.9.1 1.9.2
Research Design Population and Sample
1.10 Limitation of the Study
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
2.3
of 131
Non Performong Assets Project
Banking Statement
Search document
Research Gap
CHAPTER – III : RESEARCH METHODOLOGY 3.1
Introduction
3.2
Research Design
3.3
Sources of Data
3.4
Population and Sample
3.5
Method of data Analysis Technique 3.5.1
Financial Method
3.5.1.1 Credit Practices Ratios 3.5.1.2 Credit Efficiency Ratios 3.5.2
Statistical Method 3.5.2.1 You're Arithmetic (Average) Reading amean Preview 3.5.2.2 Unlock Correlation full access with a free trial. 3.5.2.3 Download Co-efficient of Determination With Free Trial
CHAPTER – IV : PRESENTATION AND ANALYSIS OF DATA
4.1
Comparative Financial Condition of Selected Commercial Sign up to vote on this title
Banks 4.1.1
Useful
Not useful
Comparative Credit Practices in Nabil Bank and Standard Chartered Bank
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
4.5
of 131
Non Performong Assets Project
Banking Statement
Search document
Impact of Non-Performing Loan and Performance Loan on Net Profit
4.6
Major Findings of the Study
CHAPTER – V: SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1
Summary
5.2
Conclusion
5.3
Recommendations
BIBLIOGRAPHY ANNEXES
You're Reading a Preview Unlock full access with a free trial.
Download With Free Trial
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
LIST OF TABLES
Table 1.1
Growth of Financial Institutions in Nepal
Table 1.2
List of Class A Licensed Commercial Banks (MidJan 2007)
Table 4.1
Total Loans to Deposit Ratio
Table 4.2
Interest Income to Loans and Advances
Table 4.3
Non-Performing Loan to Total and Advances
Table 4.4
Loan Advances to Total Assets Ratio
Table 4.5
Loan to Advances to Current Assets Ratio
Table 4.6
Loan Loss Provision to Total Loan & Advances
Table 4.7
Total Assets to Liabilities Ratio
Table 4.8
Interest Expenses to Total Deposit Ratio
Table 4.9
You're Reading a Preview Interest Expenses to Total Expenses Ratio
Table 4.10
Non-Interest bearing Deposits to Total Deposits
Unlock full access with a free trial.
Ratio
Download With Free Trial
Table 4.11
Interest Income to Total Income Ratio
Table 4.12
Interest from Loan, Advances and Overdraft to Total Interest Income Ratio
Table 4.13
Interest Suspense to Interest Income from Loans & Advances Ratio
Table 4.14
Sign up to vote on this title
Useful
Not useful
Relation of Loans and Net Profit in NABIL:
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
Table 4.18
of 131
Non Performong Assets Project
Banking Statement
Search document
Impact of Loan and Advance on Net Profit in NABIL: Regression Analysis
Table 4.19
Impact of Loan and Advance on Net Profit in SCBNL: Regression Analysis
Table 4.20
Impact of Non-Performing Loan and Performing Loan on Net Profit in NABIL: Regression Analysis
Table 4.21
Impact of Non-Performing Loan and Performing Loan on Net Profit in SCBNL : Regression Analysis
You're Reading a Preview Unlock full access with a free trial.
Download With Free Trial
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
LIST OF FIGURES
Figure 4.1
Total Loans to Deposit Ratio
Figure 4.2
Interest Income to Loans and Advances
Figure 4.3
Non-Performing Loan to Total and Advances
Figure 4.4
Loan Advances to Total Assets Ratio
Figure 4.5
Loan to Advances to Current Assets Ratio
Figure 4.6
Loan Loss Provision to Total Loan & Advances
Figure 4.7
Total Assets to Liabilities Ratio
Figure 4.8
Interest Expenses to Total Deposit Ratio
Figure 4.9
Interest Expenses to Total Expenses Ratio
Figure 4.10
Non-Interest bearing Deposits to Total Deposits Ratio
Figure 4.11
You're Reading a Preview Interest Income to Total Income Ratio
Figure 4.12
Interest from Loan, Advances and Overdraft to Total
Unlock full access with a free trial.
Download With Free Trial Interest Income Ratio
Figure 4.13
Interest Suspense to Interest Income from Loans & Advances Ratio
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
You're Reading a Preview Unlock full access with a free trial.
CHAPTER –I Download With Free Trial
INTRODUCTION 1.1
Background of the Study
Nepal is one of the least development countries in the world. basically
an
agricultural,
Sign up to vote on this title
mountainous
and
Useful
landlocked
Not useful
kingd
surrounding by two large, fast developing nations, China and In
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
economic policies such as industrial policy, foreign investment pol privatization policy and trade & transit policy.
Nepal has adopted mixed and liberal economic policy with the imp objective to help the state and the private sector. Especially
restoration of the democracy, the concept of the liberalization policies been incorporated as directive principle and state policies.
liberalization has helped in establishing many companies, banks, fina
companies and manufacturing industries. Thus these establishments h the country for its development.
The growth of banking is not so long. In comparison with o
developing or developed country, the institutional development
banking system of Nepal is far behind. Even though the specific dat You're a Preview the beginning of money andReading banking deal in Nepal is not obvious,
access with a free trial. speculated that during Unlock the full reign of the king Mandev the coin “Man
and “Gunak” during theDownload reign ofWith the Free kingTrial Gunakamdev were in use. A
the unification of Nepal. Prithvi Narayan Shaha, the great king had u
coin “Mohar” in his name. An institution called “Taksar” was establis
in 1989 and it started to issue the coin scientifically. During the reign
Ranodip Singh an office named “Tejarat” was established in Kathma Sign up to vote on this title
in 1993 B.S. It used to provide loans to the government officials and
Useful
Not useful
people against deposit of gold and silver. It had also extended
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
Nepal. Rastriya Banijya Bank was established in government secto th
2022 and Agricultural Development Bank on 7 Magh, 2024. Nepal A
Bank Limited is the first joint venture bank established in 2041 under
Commercial Bank Act 2031 and Companies Act 2021. Now there are
commercial banks in Nepal that include 2 local commercial banks and joint venture banks. There are 35 development banks. Then, in the
financial system covers 72 finance companies, 11 micro cr
development banks, 18 insurance companies, 47 NGO’s licensed perform limited banking functions under the supervision of (Shrestha, M.K., 2006:2).
The credit policy cannot be sound unless it is based on a clear knowle
of the cost of credit. The is determined by the quantity of credit sales,
average collection period and the opportunity cost of capital. Whil You're Reading a Preview
marginal costing approach should be used which takes only increme Unlock full access with a free trial.
cost into account, the full opportunity cost has to be considered. Download With Free Trial
overall cost of credit will also be affected by the expected rate
inflation. Foreign accurate assessment of the cost of capital, a discoun
approach should be used. A credit package can be differentiated
various ways; by duration, by interest charge and by the interaction w the rest of the pricing mix.
Sign up to vote on this title
Useful
Not useful
Table 1.1: Growth of Financial Institutions in Nepal
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Development Banks Saving & Credit Cooperatives NGOs (limited banking activities) Total
-
-
6
19
20
19
-
-
-
7
47
47
7
44
98
181
193
4
5
Source: Banking and Financial Statistics-48, a journal of Bank & Financial Institutions Regu Department, NRB, Mid-January 2007, p. iii
1.2
Meaning of Commercial Bank
Commercial Banks are those banks, which perform all kinds of bank function as accepting deposits, advancing credits, credits creation
agency functions etc. They provide short-term credit, medium-t credits and long-term credit for trade and industry. They also operate You're Reading a Preview
balance sheet functions such as issuing guarantee, bonds, letter of etc.
Unlock full access with a free trial.
Download With Free Trial
In every country, outset of economic development is quite different
there is no debate about the significant role of banking sector for
economic development of the countries, as they are considered as main source of finance. Sign up to vote on this title
Without the development of sound commercial banking, underdevelo Useful Not useful
countries cannot hope to join the ranks of advanced countries
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
a. Help in business expansion b. Encouragement for the right type of industries c. Necessary for trade and industry d. Transfer of surplus funds to needy regions 1.3
Brief History of the Evolution of Banking in Nepal
The invention of money was a milestone in the history of economy developing the banking as a habit people. It has made economic
business activity more precise and efficient. This gave the emergenc non-institutional banking activities. Merchants, Moneylenders
Goldsmith were the leader of such unorganized economic and finan
transactions. Thus, the Merchants, Moneylender and Goldsmith were ancestors of modern bankers. During the early periods although
You're Reading a Preview banking business was mostly done by private individuals, many coun
Unlock full access with a free trial. established public banks either for the purpose of facilitating comm
or to serve the government. The of Venice established in 1 Download WithBank Free Trial
A.D., is supposed to be the most ancient bank. Originally, it was no
bank in modern sense being simply an office for the transfer of public public debt.
During 1401, a public bank was established in Barcelona. It used Sign up to vote on this title
Not exchange, useful Useful bill on exchange money, receive deposits and discount both
the citizen and foreigners. During 1407, The Bank of Geneva
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
The evolution of the original banking system in Nepal has a more rec
history than in other countries of the world. Before the establishmen
“Tejarath Addha” during the period of the premier of Ranoddip Sin
the unorganized sector i.e; Moneylenders, Goldsmiths, Landlords h
their universal domination on the financial matter. They used to cha very high interest rates. The Addha was initiated to provide credit
cheap rate against gold and silver. The area of its functioning was lim
to Kathmandu vally and some urban areas of the Terai. “Tejarath Add
may be regarded as the father of the modern banking institutions and f
long time it rendered a good service to government servants as well a
general public by mobilizing scattered saving in the country and prov credit to the people at a cheaper rates.
The establishment of banking institutions depends upon the leve You're Reading a Preview
economic activities and monetary transactions. As a result of grow Unlock full access with a free trial.
banking and business activities within the nation and the instituti Download With Free Trial
progress in the neighboring countries, had forced Nepal to think of a
establishment of banking institutions. Consequently, Nepal Bank Lim
was established in 1937 under the Nepal Bank Act 1936, hav
elementary function of a commercial bank. Later, in 1956, the first cen bank, named as the “Nepal Rastra Bank” was set up underthe Sign up to vote on this title
Useful Not usefulprotecting Rastra Bank Act.1955, with and objective of supervising,
directing functions of commercial banking activities. Another commer
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
and to attract the foreign investment and technology. The establishm
of Nabil Bank Limited in the name of Nepal Arab Bank Limited in 1
A.D. under the company act 1984 was stride in the history of mod banking in Nepal. This was the first joint venture commercial
established in collaboration with Emirates Bank International (Dub Following this, in 2042 B.S. Nepal Indo-Suez Bank Limited (name been changed to Nepal Investment Bank Ltd.), in 2043 B.S.
Grindlays Bank Limited (name has been changed to Standard Charte
Bank Ltd.), in 2049 B.S. Himalayan Bank Limited and in 2050 Ne
Banghladesh Bank Limited were established. Now there are more tha dozen commercial banks performing their operation.
This way, Nepalese banking has stepped a great stride in its developm
However, Nepalese banking has not been succeeded in bringing cha You're Reading a Preview
in the economy in society and in people. The large portion of natio Unlock full access with a free trial.
economy is still behind the touch of present banking system. Download With Free Trial
unorganized moneylender has been playing a monopoly role in gran
the loan to public of remote economy and this monopoly result
excessively higher interest rate than that of institutional banker. Thus,
moneylenders are still exploiting the public of rural sector in the abse
finan of easy access to banking activities. Increasing the number of Sign up to vote on this title
Not useful Usefulthetotal institutions has not proportionately increased banking beha
of people. This is because most of the financial institutions are situate
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
NRB is an apex institution in money and capital market in Nepa
works as a central bank of the country. Banks and other finan
institutions are supervised, directed, regulated and controlled by N Following is the list of the licensed Commercial Bank as on Mid2006.
You're Reading a Preview Unlock full access with a free trial.
Download With Free Trial
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
Table 1.2: List of Class A Licensed Commercial Banks (Mid-Jan 200 Operation
Names
Date (A.D.)
Head Office
1. Nepal Bank Limited
1937/11/15
Dharmapath, Ktm.
2. Rastriya Banijya Bank
1966/01/23
Singhdarbarplaza, Ktm
3. NABIL Bank Limited
1984/07/16
Kantipath, Kathmandu
4. Nepal Investment Bank Ltd.
1986/02/27
Darbar Marg, Ktm.
5. Standard Chartered Bank Nepal Ltd.
1987/01/30
Naya Baneshwor, Ktm
6. Himalayan Bank Limited
1993/01/18
Thamel, Kathmandu
7. Nepal SBI Bank Limited
1993/07/07
Hattisar, Kathmandu
8. Nepal Bangladesh Bank Limited
1993/06/05
Naya Baneshwor, Ktm
9. Everest Bank Limited
1994/10/18
Lazimpat, Kathmandu
10. Bank of Kathmandu Limited
1995/03/12
Kamaladi, Ktm
11. Nepal Credit & Commerce Bank
1996/10/14
Siddharthenagar,
Ltd.
You're Reading a Preview
Rupandehi
12. Lumbini Bank LimitedUnlock full access with1998/07/17 a free trial.
Narayanghat, Chitawa
13. Nepal Industrial & Commercial 1998/07/21 Download With Free Trial Bank Ltd.
Biratnagar, Morang
14. Machhapuchhre Bank Limited
2000/10/03
PrithiviChowke, Pokh
15. Kumari Bank Limited
2001/04/03
Putalisadak, Ktm
16. Laxmi Bank Limited
2002/04/03
Adarshanagar, Birgun
17. Siddhartha Bank Limited
2002/12/24
Kamaladi, Ktm.
18. Agricultural Development Bank Ltd.
Sign up to voteRamshahapath, on this title 2006/03/16 Ktm
19. Global Bank Limited
2007/01/02
Useful
Not useful
Birgunj, Parsa
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
the main part of the investment; the most of the investment activi based on credit; it is the mail factor for crating profitability; it is the
source of creating profitability; it determines the profitability. It aff
the overall economy of the country. In today’s context, it also affect
national economy to some extent. If the bank provides credit to retaile will make the customer status. Similarly, it provides to trader
industry, the government will get tax from them and help to incre
national economy. It is the security against depositors. It is proved f
very beginning that credit is the shareholder’s wealth maximiza
derivative. However, other factors can also affect profitability and we
maximization but the most effective factor is regarded as credit. It is m
challenging job because it is backbone in commercial banks. T effective management of credit should seriously be considered. You're Reading a Preview
Management is the system, which helps to complete the every Unlock full access with a free trial.
effectively. Credit management is also the system, which helps to man Download With Free Trial
credit effectively. In other words, credit management refers managem
of credit exposures arising from loans, corporate bonds and cr
derivatives. Credit exposures are the main source of investmen
commercial banks and return on such investment is supposed to be m source of income.
Sign up to vote on this title
Useful
Not useful
Credit management strongly recommends analyzing and managing
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
however, other sources of credit risk exist through out the activities bank, including in the banking book, and in the trading book, and
increasingly facing credit risk in various financial instruments other t land, including acceptances, inter bank transactions and guarantees the settlement of transactions.
The credit policy of a firm provides the framework to determine whe
or not to extend credit and how much credit to extend. The credit po
decision of a bank has two broad dimensions; credit standards and cr
analysis. A firm has to establish and use standards in making cr
decision, develop appropriate sources of credit and methods of cr analysis. 1.5
Introduction of Sample Organization under study You're Reading a Preview
Nabil Bank Limited (NABIL)
Unlock full access with a free trial.
Nabil Bank Limited was incorporated in collaboration with Emir Download With Free Trial
Bank International (Dubai) in 1984 in name of Nepal Arab Bank Limi
Nabil Bank Ltd. is the first joint venture bank in Nepal, establishe
1984 A.D. under the company act. Dubai Bank Ltd. was the in
foreign joint venture partner with 50% equity investment. The sh Sign up to vote on this title
owned by DBL were transferred to Emirates Bank Internati
Useful
Not useful
Ltd.(EBIL), Dubai. Later on EBIL sold its entire holding to Natio
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Share Subscription and Capital Structure of Nabil Subscription
% Holding
NB International
50.00%
NIDC
10.00%
Rastriya Beema Sansthan
9.66%
Nepal Stock Exchange
0.34%
Nepalese Public Shareholder
30.00%
Total
100.00%
Share Structure
NRs.
Authorized Capital
500,000,000
Issued Capital
491,654,400
Paid up Capital
491,654,400 You're Reading a Preview
Standard Chartered Bank Nepal Limited (SCBNL) Unlock full access with a free trial.
Standard
Chartered Download Bank Nepal With FreeLimited Trial
was
incorporated
collaboration with ANZ Grindlays Bank Limited in 1987 as third j
venture bank. The bank was initially incorporated in the name of N Grindlays Bank limited. In 2000, the ANZ Grindlays Bank
amalgamated in Standard Chartered Banking group and 50% stake Sign up to vote on this title
former was transferred to the latter by the virtue of amalgamat
Useful
Not useful
Consequently, the name of the bank was hanged as Standard Chart
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
operating in Nepal. An integral part of the only international bank Group operating in Nepal, the Bank enjoys an impeccable reputation
leading financial institution in the country. With nine branches an ATMs across the Kingdom. Share Subscription and Capital Structure of SCBNL Subscription
% Holding
Standard Chartered Grindlays Banks Ltd.
50.00%
Nepal Bank Ltd.
35.00%
Nepalese Public Shareholder
15.00%
Total
100.00%
Share Structure
NRs.
Authorized Capital Issued Capital Paid up Capital 1.6
You're Reading a Preview Unlock full access with a free trial.
Download With Free Trial
339548800.0
339548800.0
339548800.0
Statement of the Problem
Most banking problems have been caused by weakness in cr
management. Banks should now have a keen awareness of the nee identify measure, monitor and control credit as well as to determine Sign up to vote on this title
usefulare adequa Useful they hold adequate capital against it. These risks thatNotthey
compensated for risks incurred. So, to establish creditability position
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Credit is a very important tool of commercial banks. It is regarded as
heart of every commercial bank. But credit management is not soun
banking sector. Thus, credit management is considered as the major is in Nepalese commercial banking sector.
Credit management concept has appeared as a major research gap
Nepalese commercial banking sector. There is lack of such scientific
empirical research that could identify the issues of credit managemen
Nepalese commercial banks. In this regard, the performance of Nepa
commercial banks is to be analyzed in terms of their credit. So
research questions regarding to the credit practices, credit efficienc liquidity
position,
industrial
environment,
management
qua
organization climate are considered as a clear evident in present situat
Thus, the specific research questions regarding credit managemen You're Reading a Preview
Nepalese commercial banking sector are identified as follows:Unlock full access with a free trial.
1.
Are the credit practices adopted by commercial bank in Download With Free Trial position ?
2.
What is the credit efficiency of the Nepalese commercial banks?
3.
Is the quality of management good in commercial banks?
4.
Is there any relationship between credit position and profitab situation?
5.
Sign up to vote on this title
Useful
Not useful
How does the commercial bank manage better creditab
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
of 131
Non Performong Assets Project
Banking Statement
Search document
1.
To assess credit practice of selected commercial banks.
2.
To explore the credit efficiency of selected commercial bank
3.
To explore the relationship with loan and advances, n
performing loan and net profit of selected commercial banks 4.
To recommend for the improvement on the basis of finding the study after analyzing the credit management.
1.8
Significance of the Study
Commercial banking sector is considered as successful area in finan
sector of Nepal. In today’s context, commercial banks have to be m organic and sincere to establish better creditability position due to
competition among them. The present concept deals with h
commercial banks managed credit position and how do it affect to You're Reading a Preview organizational effectiveness. Unlock full access with a free trial.
Present study is very important from the point of view of b Download With Free Trial
management. The main strategy of every commercial bank is to estab
the better creditability position, which has directly impacted the finan
performance of an organization. Besides, it helps to build positive attit
and perception on customer that helps to make the organizational suc
in terms of better transaction, better turnover and better profitability m Sign up to vote on this title
Useful Not useful financial of the earlier researches were focused on performance of b
but few researches were focused on creditability position of bank.
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
1.9
of 131
Non Performong Assets Project
Banking Statement
Search document
Research Methodology
Research methodology is a systematic way to solve the research probl
In other words, research methodology describes the methods and pro
applied in the entire aspect of the study. Research methodology refer
the various sequential steps(along with a rational of each steps) to
adopted by a researcher in studying problem with certain objective view. 1.9.1 Research Design
Research Design serves as a framework for the study, guiding
research instruments to be utilized, and the sampling plan to be follow
In other words, research design describes the general plan for collect
You're Reading a Previewthere exists different type analyzing and evaluating data. For research
Unlock full access with a free trial. research design like Historical Research, Descriptive Research, C
study Research, Field Download Study Research, Analytical Research and so With Free Trial
This study mainly concerned with historical research. To test the cr practices and efficiency position of the commercial banks historical
is used. The relevant and needed data can be collected from vari publications of different commercial banks and Nepal Rastra Bank. Sign up to vote on this title
1.9.2 Population and Sample
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
of 131
Non Performong Assets Project
Banking Statement
Search document
universe is made. Here only 2 sample commercial banks are taken out 20 commercial banks. i.
Nabil Bank Limited (NABIL)
ii.
Standard Chartered Bank Nepal limited (SCBNL)
1.10 Limitation of the Study
The scope of the study is limited only in commercial banks because
time and resource constraints. Most of the analyses are descriptive
present study. This study is very basic attempt to address the rese
issues; therefore, it might not be able to show casual linkage or eff Instrument used for data collection is not standardized questionnaire. Present study could not address all the aspects of credit position.
study is based on employees; self repeated response about t You're Reading a Preview
perception on primary analysis. It is, therefore, the response colle Unlock full access with a free trial.
from the employees might not be valid measure. Download With Free Trial
Secondary analysis is based on published financial data on collected f stock exchange center and share department of the concerned banks.
secondary analysis covers time span of current five years. Var
financial tools are used to know financial condition of the ba Sign up to vote on this title
However, the study tries to find out credit position and its importanc
selected commercial banks.
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
Chapter-I Introduction
This chapter describes the basic concept and background of the study
has served orientation for readers to know about the basic informatio
the research area, various problems of the study, objectives of the stu
It is oriented for readers for reporting giving them the perspective t need to understand the detailed information about coming chapter. Chapter-II Review of Literature
The second chapter of the study assures readers that they are familiar w important research that has been carried out in similar areas, It
establishes that the study as a link in a chain of research tha developing and emerging knowledge about concerned field. Reading a Preview Chapter-III Research You're Methodology Unlock full access with a free trial.
Research methodology refers to the various sequential steps to be adop Download With Free Trial
by a researcher in studying a problem with certain objectives in view
describes about the various source of data related with study and vari tools and techniques employed for presenting the data. Chapter-IV Presentation and Analysis of Data Sign up to vote on this title
useful Useful Notpresents This chapter analyses the data related with study and the find
of the study and also comments briefly on them.
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
CHAPTER - II
REVIEW OF LITERATURE
The review of literature is a crucial aspect because it denotes plannin
the study. The main purpose of literature review is to find out what wo
have been done in the area of the research problem under study and w
has not been done in the field of the research study being undertaken. review study, the researcher uses different books, reports, journals research
studies
published
by
various
institutions,
unpublis
dissertations submitted by master level students have been reviewed. It is divided into two headings: • Conceptual Review
Studies • Review of different You're Reading a Preview 2.1
Unlock full access with a free trial.
CONCEPTUAL REVIEW
Download With Free Trial
“Banking is the business of collecting and safeguarding money
deposits and lending of same. The banker’s business is then to taken
debt of other people to offer his own in exchange and thereby to cr
money. He may be a dealer in debts, but in distress is only the observ wealth and it would be equally permissible describe the banker Sign upto to vote on this title
liquefies of wealth” (Crowther, 2001: 81).
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
The credit policy cannot be sound unless it is based on clear knowle
of the cost of credit. The cost is determined by the quantity of credit sa
the average collection period and the opportunity cost of capital. Whil
marginal costing approach should be used which takes only increme cost into account, the full opportunity cost has to be considered.
overall cost of credit will also be affected by the expected rate
inflation. Foreign accurate assessment of the cost of capital, a discoun
approach should be used. A credit package can be differentiated
various ways; by duration, by interest charge, and by the interaction w the rest of the pricing mix.
A commercial bank is a business organization that receives and h
deposits of fund from others makes loans or extends credits and trans funds by written order of deposits.
You're Reading a Preview
full access with a free trial. Commercial bank is Unlock a corporation, which accepts demand depo
subject to check and Download makes short-term loans to business enterpri With Free Trial regardless of the scope of its other services.
A commercial banker is a dealer in money and substitute for money s
as cheques or bill of exchange. He also provides a variety of finan services.
Sign up to vote on this title
Useful
Not useful
Commercial bank Act 2031 B.S. of Nepal has defined that
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
which defines the bank with respect to their transactions. This Ac
trying to categorize the banking institutions in two ways based on t
transactions. According to this Act, “Bank is the institution wh performs its transactions under the section 47 of this Act.”
This Act has laid emphasis on the functions of commercial bank w
defining it. Commercial banks provide short-term debts necessary
trade and commerce. They take deposits from the public and grant lo
in different forms. They purchase and discount bills of excha
promissory notes and exchange foreign currency. They discharge var
functions on the behalf of their customers, provided that they are paid their services.
Financial activities are necessary for the economic development of
You're Reading Preview country and commercial banking inathis context is the heart of finan
Unlock full access with a free trial. system. Optimal investment decision plays a vital role in each and ev
organization. But especially for With the Free commercial bank and other finan Download Trial institutions the sound knowledge of investment is the must because
subject is relevant for all surrounding that mobilize funds in diffe sectors in view of return.
As it is concerned to the commercial banks and other finan Sign up to vote on this title
Not useful sectors) t Useful indifferent institutions, they must mobilize (i.e; investment
collections (deposits) and other funds towards the profitable, secured
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
The income and profit of the bank depend upon the lending proced
applied by the bank. And, lending policy and investment in diffe
securities also affect the income and profit. In the investment procedu
and policies is always taken in mind that “the greater the credit created the bank, the higher will be the profitability.” A sound lending investment policy is not only prerequisite for bank’s profitability but
crucially significant for the promotion of commercial savings o developing country like Nepal.
The sound policies help commercial banks maximize quality and quan
of investment and there by, achieve the own objective of pr
maximization and social welfare. Formulation of sound investm
policies and coordinated and planned efforts pushes forward the forc economic growth.
You're Reading a Preview
Unlock full access with a free trial. Commercial banks as financial institutions perform a number of inte
functions. Among them, providing is considered as most impor Download Withcredit Free Trial
one. “Commercial banks brings into being the most important ingred
of the money supply, demand deposit through the creation of credit in form of loan and investment.”
2.1.1 Financial Analysis
Sign up to vote on this title
Useful
Not useful
Financial analysis is the process of identifying the financial strengths
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Ratio analysis is the process of determining and interpreting numer
relationship based on financial statements. A ratio is a statistical yards
that provides a measure of the relationship between two variable figures.
Webster’s new collegiate dictionary defines a ratio as “ The indica
quotient of two mathematical expression and as the relationship betw
or more things.” In financial analysis a ratio is used as benchmark
evaluating the financial position and performance of a firm. (“webst th
New Collegiate Dictionary” 8 Edition Supering Field Mass.) Standard of Comparison
The ratio analysis involves comparison for a useful interpretation
financial statements. A single ratio in itself doesn’t indicate favorabl You're Reading a Preview
unfavorable condition. It should be compared with some stand Unlock full access with a free trial.
Standard of comparison may consist of:
Download With Free Trial
Past ratios – ratio calculated from the past financial statemen the same firm.
Projected ratio – ratio developed using the projected or finan statement of the same firm.
Sign up to vote on this title
Competitor’s ratio – ratio of some selected firms, especially
Useful
Not useful
most progressive and successful competitor, at the same poin
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
solvency and profitability of the firm. Similarly owners concentrate
the firm’s profitability and financial condition. Management is intere
in evaluating every aspect of firm’s performance. They have to pro
the interests of all parties and see that the firm grows profitability
view of the requirement of various ratios they may classify into follow groups. Credit Practices Ratio • Total Loan to total deposit ratio
The main source of bank’s lending depends on its deposit. This rati
calculated to find out how successfully the banks are utilizing t
deposits on loan and advances for profit generating activities greater r indicates the better utilization of total deposits. You're Reading a Preview
Unlock full access with a free trial.
• Loan and advances to total assets ratio
Download With Free Trial
Loan and advance is the major part of total assets for the bank. This r
indicates the volume of loans and advance out of the total assets. A h
degree of the ratio indicates that the bank has been able to mobilize
fund through lending function. However lending always carries a cer and risk of default. Therefore a high ratio represents Sign up to votelow on thisliquidity title
Not useful Useful for ratio represents low productivity with high degree safety in term
liquidity.
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
may lose earnings. So commercial banks provide loan and advance
appropriate level to find out portion of current assets, which is grante loan and advances. • Interest income to loan and advances
Interest income to loan and advances is one of the major source
income for a commercial bank. The high volume of interest incom indicator of good performance of lending activities. • Loan loss provision to total loan and advances ratio
It describes the quality of assets that a bank is holding. NRB has dire
the commercial banks to classify its loan and advances into the categ
of pass, standard, doubtful and loss and to wake the provision of 1, 25 You're ReadingNRB a Preview and 100 percent respectively. has classified the pass Unlock full access with a free trial.
substandard loan as performing loans and other two types of loans n
Download With Free Trial performing loans. The provision created against the pass and substand
loan is called the general loan loss provision and provision cre
against the doubtful and loss loan is called specific loan loss provis
The provision for loan loss reflects the increasing probability of n performing loan. Increase in loan loss provision decreases in profit Sign up to vote on this title
to decrease in dividends. But Its positive impact is that strengthens
Useful
Not useful
financial conditions of banks by controlling the credit risk and redu
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
• Non-performing loan to total loan and advances ratio
NRB has directed all the commercial banks create loan loss provi
against the doubtful and bad debts. But our concerned banks have
provided data on non-performing loan in Balance Sheet and Profit & L A/C. To measure the volume of non-performing loan to total loan
advances the main indicator of NABIL and SCBNL has been used. T ratio shows the percentage of non-recovery loans in total loans advances. Credit Efficiency Ratio • Interest expenses to total deposit ratio
This ratio measures the percentage of total interest paid against t You're Reading a Preview
deposit. A high ratio indicates higher interest expenses on total dep Unlock full access with a free trial.
Commercial banks are dependent upon its ability to generate chea Download With Free Trial
fund. The cheaper fund has moved the profitability of generating lo and advances and vice versa. • Total loan to liabilities ratio
Banks create credit through loans and advances andonmultiply their as Sign up to vote this title useful Useful This Notratio much more times than their liability permits. measures
ability of a bank to multiply its liability into assets. The higher ratio
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
• Interest expenses to total expenses ratio
This ratio measures the percentage of interest paid against total expen The high ratio indicates the low operational expenses and vice versa. ratio indicates the costly sources of funds. • Non-interest bearing deposit to total deposit ratio
This ratio measures the volume of non-interest bearing deposits to t
deposit. The volume of interest expenses in total expenses represen
large portion of the total expenses. How efficiently the deposits w
managed affectively in the total volume of expenses. The banks nee
manage the portfolio of the deposits i.e; it has to maintain cer
proportion between interest bearing deposits and non-interest bea
You're Reading a Preview deposits by administering the interest rate structure. The higher rati Unlock full access with a free trial.
favorable but in practices, interest bearing deposits always play Download With Free Trial significant role in the mix deposit liability.
• Interest income to total income ratio
Income is one of the most important factors of each and ev
organization. Interest income occupies a greater portion of the t Sign up to vote on this title
income in a banking business. This ratio measures the volume of inte
Useful
Not useful
income in total income. It helps to measures the bank’s performance
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
of 131
Non Performong Assets Project
Banking Statement
Search document
• Interest from loan, advances and overdraft to total interest inco
ratio
This ratio measures the contribution made by interest from loan, advan
and overdraft. Loan and advances generate the major portion of inte
income. Hence this ratio measures how efficiently the banks h employed their fund and loan & advances and overdraft.
• Interest suspense to total interest income from loan & advan
ratio
Interest suspense means the interest due but not collected. NRB direct do not allow the commercial banks to book due but unpaid interest
income. The increase in the interest suspense decreases the profit of
Reading Preview side of Balance Sheet un company. Such interestYou're is shown in aliability Unlock full access with a free trial.
the heading “other liability”. This ratio, interest suspense to total inte Free Trial the composition of due income from loan & Download advances,With measures
uncollected interest in the total interest income from loans &advan The high degree of this ratio indicates the low interest turnover and
degree of this ratio indicates high interest turnover. This ratio also h
to analyze the capacity of the bank in collecting the repayments of loan and advances. 2.1.2 Factors Affecting Credit Policy
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
• Industry environment
It determines the nature of the industry structure, its attractiveness and
company’s position within the industry, structural weakness o
company, which is disadvantaged, theaters first way out and secu value. • Financial Condition
It determines the borrower’s capacity to repay through cash flow as
“First way-out”. The strength of “second way-out” i.e; through collat
liquidation is also assessed. Further the possibility to fall back on inco
of sister concerns in case of financial crunch of the company condi theaters repayment capacity. You're Reading a Preview
• Management Quality Unlock full access with a free trial.
Downloadcompetence With Free Trial and nature of alliances It determines the integrity,
borrower’s management team. Weakness in replacements needs evaluated. • Technical strength Sign up to vote on this title
It determines the strength and quality of theUseful technicalNotsupport required useful
sustainable operation of the company in terms of manpower
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
present value of the properties mortgaged with the bank. Weaknes security threatens the bank’s second way out. 2.2
Review of Related Studies
Present section deals about concept or findings of earlier scholars on concerned field of the study. It helps to develop the study as link
chain of research that is developing and emerging the knowledge ab the related field.
The effort has been made in this present section to examine and rev
some related articles published in different economic journals, bullet magazines and newspapers. Nepal Rastra Bank has issued directives to all commercial banks
You're Reading a Previewduring loan disbursement financial institutions ensuring transparency
Unlock full access with a free trial. per provision, all commercial banks as well as financial institutions
now required to disclose the name loan defaulters in every six mon Download WithofFree Trial
Until now there was no such legal system of disclosing the l
defaulter’s name. The new directives have also barred the finan
institutions from lending any amount to the blacklisted defaulter and
family members. The Credit Information Bureau (CIB) can blacklist Sign up to vote on this title
firm, company or clear the debt within the stipulated period. As per
Useful
Not useful
set criteria for blacklisting, the CIB would monitor those individuals
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
When any sector of economy catches cold, bank start sneezing. From
perspective, the banking industry as a whole is not robust. In cas
investors having lower income, portfolio management may be limite
small saving income. But on the other hand, portfolio management me
to invest funds in various schemes of mutual funds like deposits, sh
and debentures for the investors with surplus income. Therefore portf
management becomes very important both for an individuals as wel
institutional investors. Large investors would like to select the best mi investment assets (Shrestha, 2003: 15).
The investor or whether banks, financial institutions, individuals, priv
or government sector, most not took the proposal by making decis
without having adequate judgment because sometimes they perform of norms, related studies, policies and techniques. A project appraisal You're Reading a Preview
best viable only if it has accessed through conscious analysis as we Unlock full access with a free trial.
through investment decisions to make its macro and micro level viab Download With Free Trial
effective (Lamichhane, 2000:17).
The current volume of the total banking deposits is over 1550-f
higher than what used to be some 38 years ago whereas the G
Domestic Product (GDP) of the country during the same period pr Sign up to vote on this title
increased just by 62-folds. Central bank static’s shows that the t
Useful
Not useful
banking deposit in 1965used to be just Rs. 129.8 million, but swelle
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
expansion and private sector development, the nineties witnesse
quantum jump in both deposit mobilization and lending. The deposi
banking system, by the end of 2002, touched Rs. 154.5 billion, whic
7-folds more than the deposit of the nineties. Loans and advances f
the banking system touched Rs. 118 million by June-end 2000 and
amount was double than what it used to be in 1985 (The Kathmandu P (2003), “Central bank tightens blacklisting procedures”, p. 9).
In the post report titled “Loan loss provision rises Notably” publishe
the Kathmandu Post, the reporter had made an endeavor to highl
some facts and figures regarding loan loss provision of commer banks. “The banking sector is witnessing a huge surge in loan provisioning reserve lately. The increment is primarily a result
directive issued by Nepal Rastra Bank (NRB) in 2001 that introdu You're Reading a Preview
stringent loan provisioning criteria for commercial banks. As per Unlock full access with a free trial.
recently released by the central bank, the total loan loss provision in Download With Free Trial
country’s banking sector increased from around Rs. 8.73 billion in m
April 2001 to Rs. 13.18 billion mid-April 2003. The increment is ove
percent. As per the latest NRB figures, a remarkable surge has see
loan provision of Nepal Bank Ltd.(NBL). Against the provision of Rs.
million in mid-April 2002, the loan provision amount surged towhopp Sign up to vote on this title
Rs. 7.33 billion in a year.
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
The reporter concludes, “The directives laid down stringent guidel
relating to loan loss provisioning to ensure a good health of the ove banking system. The directives requires loans to be provisioned
extend of cent percent if payment is defaulted for one year. Likewise,
directives require loans to be provisioned to the extent of 25 percen
payment is defaulted for over three months and 50 percent if the perio
default extends beyond six months. The earlier directives requ progressive provisioning of loans, but allowed maximum of three
unlike the present system of just year, for loans to be provisioned to extent of cent percent. Mr. Binam Ghimire (1999) in his article titled “Credit sector reform NRB” has tried to highlight the effects of change or amendment in
directives regarding loan classification and loan loss provision You're Reading a Preview
“Although the circumstances leading to financial problems or crisi Unlock full access with a free trial.
many Nepali banks differ in many respects, what is common area mos Download With Free Trial
the banks is the increased size of non-performing assets (NPAs).
resolve the problem of the losses or likely losses of this nature facing
industry NRB has, as the central bank, amended several old direct
and issued many new circulars in the recent years” (Ghimire, 1999: 49).
Sign up to vote on this title
Useful
Not useful
As opined by him, since majority of the loans of most of the commer
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
that loan loss provisioning as a percentage of total credit of April
2001 is 5.2% but as April 13, 2003, it has jumped to 18.39. If only priv bank are considered, it is 2.12% of April 2001whereas it is 6.30% April 13, 2003. The total increment in LPP is Rs. 11,328.11 million the total increment in credit is only Rs. 7,976.70. He has also stated tightening provisioning requirements on NPL is essential to ensure banks remain liquid even during economic downturns. In the conclusion he has mentioned that in the recent years NRB
worked for management and reform of the credit of the finan
institution more seriously and NRB has adopted reforms aimed not ju
dealing with problem banks but also at strengthening banking supervi
to reduce the likelihood of future crisis. “All prudential directives of N
in connection of credit sector reform have been made revised on a You're Reading a Preview
April 2001. To adopt to such changes there can be some difficulties Unlock full access with a free trial.
for a better and harmonized reform NRB should continue to Download With Free Trial
supportive, proactive and also participative to take options of bankers a change in regulation/policy taking place in the future.”
In the article of Mr. Dependra Bdr. Chhetri (1998), titled “N
performing Assets: A need for Rationalization”, has attempted to pro Sign up to vote on this title
connation of the term NPA and its potential source, implication of N
Useful
Not useful
in financial sector in the South East Asian region. He had also gi
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
effected on the part of the debtor in order to remain loan performi (Chhetri, 1998: 17).
As stated by the writer, the definition of NPA differs from country
country. In some of the developing countries of Asia Pacific Econo
Cooperation (APEC) forum, a loan is classified as non-performing o
after it has been arrear for at least 6 months. Similarly, it is after th
months, in India. Loan thus defaulted are classified into diffe
categories having their differing implication on the asset managemen
financial institution. He also stated that NPAs are classified accordin
international practice into 3 categories namely Substandard, Doubtful
Loss depending upon the temporal position of loan default. “Thus
degree of NPA assets depends solely on the length of time the asset been in the form of none obliged by the loanee. The more time You're Reading a Preview
elapsed the worse condition of asset is being perceived and such as Unlock full access with a free trial.
are treated accordingly. “As per Mr. Chhetri’s view, failure of busin Download With Free Trial
for which loan was used, defective and below standard credit appra
system credit program sponsored by Government, slowdown
economy/recession, diversion of fund is some the factors leading accumulated of NPAs. Sign up to vote on this title
He said that there is serious implication of NPAs, on financial institut
Useful
Not useful
He further added that the liability of credit institution dies not limit to
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
Finally, he concluded that financial institutions are beset with the bur
of mounting level of NPAs in developing countries. “Such assets de
income flow of the financial institution while claiming additio
resources in the form of provisioning thereby hindering gai
investment. Rising level of NPAs cannot be taken as stimulus but vigilance demanded to solve the problem like this, eventually
generate vigor to gear up the banking and financial activities in m active way contributing to energizing growth.”
This article of Patrick F. Reidy (1995) provides an overview of the cr
portfolio management function, structural alternatives, the skill neces for its effective implementation, and a final word on training
compensation. The focus is on corporate credit portfolios, as these o present the largest concentration challenges through they can be You're Reading a Preview
modified.
Unlock full access with a free trial.
Modern portfolio management bank Downloadof With Freeassets Trial has fundamentally chan
the requirements for individuals using this technique: their backgrou
their training, and their skills in using available resources. W
traditional credit training remains necessary, today’s portfolio man
arguments this background with knowledge of early-warning syste Sign up to vote on this title
alternative structures to better set risk/return parameters, and more.
Useful
Not useful
Traditional training focused on the individual loan. Traditional cr
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
acceptable. This culture ultimately dictated the structure and composi of the bank’s total portfolio.
Protection measures against portfolio losses focused on loan loss rese based on moving-average formulas. Concentration risk was
avoided, but there were always those special customers for wh
exceptions could be made. If the formulas were correct, then ove
expected losses in the portfolio would be covered by reserves. But th
formulas and expectations were not always so accommodative. A
result, certain concentrations would invariably lead to extraordinary
unexpected, losses that were charged to income in the year of t incurrence.
Portfolio management looks at the impact of loans individua collectively,
and
You're Reading a Preview comparatively. Modern
portfolio
managem
Unlock full access with a free trial. techniques have supplemented these unwritten rules with portf
analysis and policies that establish limits Download With Free Trialon exposure by country,
obligor, by industry, and so on. These limits are derived from a spec
focus on the technical aspects of this asset class, a segmentation of credit product and an analysis of the effect of combining credits
portfolios. Credit portfolios can now be evaluated on the basis Sign up to vote on this title
fundamental as well as quantitative portfolio analysis. (This is now be
Useful
Not useful
further institutionalizes in terms of required capital as defined in
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
development as well as analytical discipline and consistency. relationship manager determines the commitment level that maximize relationship income.
2. Fundamental analysis of the individual credit. The underwri
function in credit portfolio management is charged with the m traditional responsibility of individual credit analysis
monitoring. But this function is being driven more and m
toward a specialization based on industry, so that the full bene
of analyzing alternative borrowers within an industry can
achieved. The more specialized structure enables CPM to pro
key value-added analysis to relationship and product manager
complex customer support for example, merger and acquisi
analysis. It also provides for a centralized, efficient use You're Reading a Preview
analytical resources.
Unlock full access with a free trial.
3. Portfolio monitoring. Many tools and information resou Download Withmore Free Trial
exist today than were available in the past for portfolio monitor For example; • Institutions now set various portfolio limits to shape
structure of the desired portfolio. Sign up to vote on this title
Useful Not useful portfolio deterioration h • Early-warning processes to measure
become an integral part of credit risk management.
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
4. The role of credit approval authorities. The credit appr
function determines the desired exposure level for the institutio books within the context of pre-establishes limits by obligor industry. As a result, credit approval manages expected loss
allocates capital to desirable transactions. CPM, as separate f
credit approval, optimizes the use of capital through alteration the portfolio’s profile. Alternative Structure for Credit Portfolio Management (CPM)
The establishment of credit portfolio management is typically
evolutionary process for each banking institution. At start-up, C
usually takes a defensive role eliminating concentration risk and cul
under performing relationships from the risk/return point of view.
You're Reading a Preview portfolio is added to its r CPM develops, optimization of the selected Unlock full access with a free trial. adjusting exposure to take into account the best risk/return structure.
adjustments often use the credit derivatives Download With Free Trialmarkets in order to disturb primary relationship with the customer. In its advances form, CPM
the bank’s credit view to it’s role, with the intention of improving portfolio’s relative value performance among different asset classed.
The state of CPM along this development curve often dictateswheth Sign up to vote on this title
Not useful is located inside the wall (subject to theUseful possibility of receiving
public information) or outside the wall (not subject to non
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
To do this effectively, CPM must perform all or some of the follow
key functions, depending on the state of the developmental cu discussed above:
Serve as an analytical and advisory group to the line and to
approval authorities, plus serve as an integral part of crit deal teams.
Prepare the credit approval package and advocate transaction to the credit approval authorities.
Closely monitor obligor risks, returns, and concentrations.
Evaluate, establish, and effectively use advanced mode
techniques to help determine the potential risk inherent in portfolio and its assets correlations.
Manage those same risks through the judicious use of loan s You're Reading a Preview
and synthetic instrument such as credit default swaps Unlock full access with a free trial.
CDOs. (Reidy, RMA Journal, (2005) “Corporate cr Download With Free Trial
portfolio management: changing skills requirements.”)
In an article published in New Business Age, Mr. Kamal Subedi (20
titled “growth in Major Commercial Banks” has compared between first six month of the fiscal year 2002-03 and 2003-04, which shows Sign up to vote on this title
there has been noticeable increase in credit outflow by the commer
Useful
Not useful
banks except of Nepal Bank Ltd. (NBL) and Rastriya Banijya
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
ventures. Except RBB all banks have increment in deposit collec (Subedi, 2002: 47-48).
A decrease in CD ratio (the percentage of the deposit mobilization o
the credit) signifies the presence of high liquidity and comparativ lower fund mobilization and vise versa. High liquidity and idle funds
result in lower profits. HBL has the highest growth of 18.47%in CD r
over the last year. Similarly, NABIL, Everest Bank Ltd. (EBL) and Ne SBI Bank Ltd (SBI) have recorded growth rates of 6.28%, 11.83%,
7.45% respectively in their CD ratio. However, this ratio of commer banks has declined, largely due to factors external to the banks.
As per the NRB directives, all commercial banks have to maintain l loss provision according to the size of overdue loans. Nepal Credit
You're Reading commerce bank (NCCB) were able atoPreview decrease its loan loss provision
Unlock full access with a free trial. 27.63% as compared to the previous year indicating a good recover
interest as well as principle. In With caseFree of Trial Nepal Investment Bank (NIB Download growth in loan loss provision (which in fact decreased by 6.73%)
much less than the growth of the total credit (which in fact decreased
6.73%) was much less than the growth of the total credit (which increa
by 53%). Similarly, NBL and HBL were able to maintain a hea Sign up to vote on this title
composition of loan loss provision (decreased by 9.49% & 0%
Useful
Not useful
credit (increased by 3.70% and 26078%), again signifying good res
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
noticeable increment in it. The major yardstick to measures the statu
the bank (which is the prime concern of shareholders) is the profitalib of the banks. The spread between what the banks has earned
expensed. In this regard, KBL has made the significant growth of 18.2
in profit as compared to the previous year. Similarly Standard Charte
Bank (SCBNL), NABIL, HBL, NIB, NICB and NCCB have the gro
percentage of 7.72%, 6.33%, 29.83%, 61.8%, 62.76%, 29.76%, 37.8 and 4.03% respectively.
Government of Nepal has promulgated ordinance to replace sev existing laws related to the banks and financial institution
Commercial Bank Act 2031, Finance Act etc related to finan
institutions. The major highlights of the ordinance are universal bank
that makes all the banks and financial institutions governed by a sin You're Reading a Preview
act making the legal process much efficient and with less confusion an Unlock full access with a free trial.
has protected the rights and welfare of the depositors and investors. Download With Free Trial
However this ordinance has lots of unclear issues, which has cre
confusion to the existing banks and financial institutions. The ordina has classified the financial institutions into categories replacing
present terms as commercial, development of finance companies. The Sign up to vote on this title
has classified the category, as “Ka” category Ka category mention it
Useful
Not useful
as a bank, the rest of the category should name itself only as a finan
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
credits. Even the financial institutions, which falls under the categ
“Ga” are permitted to handle current account, saving account and to so
extent, foreign currency transactions. Due to theses changes, the custo
will benefit due to the competition among these banks and finan institutions.
In an article published in New Business Age written by Sudir Kh
(2005), has analyzed the ordinance pros and cons, in general speak termed as Umbrella Act. He has expressed his disagreement in
ordinance regarding the qualification of the Board of Direct
composition. The qualification set is out of the total number of direct
two thirds have to be graduates in specified disciplines-managem
commerce, economics, accounting, finance, law, banking and statis
Another requirement is five years work experience either in banking You're Reading a Preview
public limited companies or in a gazette level government posts. Unlock full access with a free trial.
argues why a science graduate or someone with engineering backgro Download With Free Trial
cannot be the director, it is not justifiable to question on the capacitie
the people with these background as the in the past some succes
General Manager and Directors in Nepal Industrial Developm Corporation (NIDC) were engineers. He further writes that activities project financing and asset valuation require engineers and similarly Sign up to vote on this title
Not useful Usefulof there cannot be any reason for the position director in banks to
graduates in some specific fields only. CEO of the “Ka” categ
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
that the efficiency of the staff is questionable. In such situation how
one hire someone with the experience in public limited companies?
per the act, it is mandatory to appoint a professional director in the Bo
chosen from the list of professional experts entitled by NRB. S
director will not have voting right; it is questionable that can
contribute significantly towards the development of a bank or finan institution without the voting right?
For the existing banks and other financial institution a two-year pe
has been granted to apply for the license. Entirely new Memorandum
Association and Articles of Association have to be prepared and a spe
general meeting of shareholder has to be called. If any institution fail
obtain the license on the said period, there license will be sei However, there is no clear information on whether the institutions You're Reading a Preview
prepare Memorandum of Articles in their own format or are there Unlock full access with a free trial.
prescribed format available or will be made available by the central ba Download With Free Trial
Nepal Rastra Bank for this purpose.
This ordinance has given the full authority to NRB for monitor
inspection, supervision etc. NRB is vested with the power to fix inte rates in lending and deposits and the act also states that NRB can Sign up to vote on this title
delegate this authority to the individual banks themselves. However, s
Useful
Not useful
delegated authority can be taken bank. This makes banking more risk
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
on the collateral. He argues that only collateral should not be conside as the basis of the credit decision. (Shrestha, 2004: 33-34)
Access to finance is vital element for entrepreneurship developmen
the country. Without it one cannot think of starting business of any s
It’s mainly due to this reason; most of the students after completing th
single-mindedly look for employment opportunity. No other options matter how lucrative and attractive it would be enter into mind. It
created huge pressure in the labor market. In the absence
entrepreneurial activities in the country, employment opportunity wil very limited and even qualified and competent people do not get job.
established very limited and even qualified and competent people do
get job. The established notion of the Nepalese bankers that money len the wealthy people based on collateral is safe. But, is not actually a You're Reading a Preview
assumption in the face of greater difficulty in loan recovery from th Unlock full access with a free trial.
people. Also, this particular segment of market is already over-ban Download With Free Trial
With the worsening business performance of the Nepalese corpo
sector mostly due to the poor management compounded by other fa
like sluggish economic conditions and political instability, banks m now explore newer market segment for their sustained growth
success. Under this backdrop, Nepalese commercial banks must cha Sign up to vote on this title
Useful Not useful their policy and must understand that event the people living in the
and middle level of economic pyramid can potentially be lucra
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
market opportunity for the Nepalese banking industry only if it can co out of the cocoon of traditional collateral-driven lending approach. At the time when Nepalese banking industry is confronting with increasing NPA, it might seem unwise and untimely to suggest
commercial banks extend loan to the potential entrepreneurs with
collateral. It is not that they must ignore the collateral altogether w
making credit decision. Collateral may be one of the important elem of the credit decisions. But this should not be a pre-condition for credit decision. Lesson should be learned from the past experience of
credit policy that collateral alone does not ensure quality of cr decision. The fluctuation and stagnancy in the real state business
further reinforces this view. More important, Nepalese bankers m
themselves have to have entrepreneurship spirit which means, they sho You're Reading a Preview
not hesitate to take educated risk by giving more weight to Unlock full access with a free trial.
entrepreneurship dimension of the credit proposals while making cr Download With Free Trial
decision. The ability of lending is identifying and investing a dist competitive advantage in the crowded market. However it’s essential
any government rules and regulations that inhabit the promotion entrepreneurship in the country must be abolished. Sign up to vote on this title
Entrepreneurship development is one of the important conditions for
Useful
Not useful
economic growth of a country. There must be the sprout
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
The ordinance relating to banks and financial institutions has b
promulgated that has been bought into existence effective from Febru 4, 2004. The banks and financial institutions ordinance, 2004
replaced the existing Agricultural Bank Act, 2024. Commercial B
Act, Development Bank Act, and Nepal Industrial Developm
Corporation Act and Finance Companies Acts and brought all s
institutions under the preview of a single Act. Though this ordina
came as an achievement in the financial sector reform program, it’s be
a matte of debate among the various finance experts that the ordina
having six months existing time should be enacted? The ordina popularly called as Umbrella Act.
In an article “Comments on Umbrella Ordinance 2004” Mr. Ti
Upadhyay, former president of ICAN has expressed clearly described You're Reading a Preview
ordinance along with his views. The ordinance is comprehensive Unlock full access with a free trial.
prescribes
in
detail
the
provisions
for
Download With Free Trial
licensing,
incorporat
governance and merger and dissolution procedures for banks
financial institutions. This is a significant improvement over the exis
acts but apprehension is expressed about the discretionary power that
ordinance has vested on Nepal Rastra bank. (Upadhyay, “Comments Umbrella Ordinance 2004”. P 16-17)
Sign up to vote on this title
Useful
Not useful
The ordinance is divided into 12 chapters and contains altogether
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
Second chapter specifies the procedures for establishing a bank
financial institution and has brought transparency in licensing proced
The authority has to either issue the license within 120 days
application or notify the reason of refusal within the said period. Furt
a foreign bank’s presence in Nepal either through a joint venture branch banking is legally mandated. This provision will probably
the long outstanding demand of the donors and conforms to Nepal’s e
to WTO. Buying back of its share by a financial institution, a uni
provision is legal slated by this ordinance, and that could be consid
progressive. But it has failed to explain the objective of such provi and at the same time appears to be too restrictive to implement.
ordinance has failed to prescribe condition for enhancing the stak joint venture partner, fresh issue of shares to strategic partner, issue
You're a Preview issue that is vital from employees’ stock option planReading and preferential
investor’s perspective. Unlock full access with a free trial. Download With Free Trial
Chapter three deals with the constitution and board of directors
appointment of CEO. Henceforth, in addition to directors appointed the shareholders, meeting, the financial institutions (FIs) must have independent director in its board appointed from amongst the names
roster maintained by NRB. Also, the academic qualification ofremain Sign up to vote on this title
Useful Not usefulof all direc directors has been prescribed that requires that two-third
must posses required academic qualification and experience but it
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
not commensurate to the potion of a CEO. As the law does not guara vesting of executive authority on CEO, it may be played down at
hands of unscrupulous directors and might inconsistent with the princ of divesting management from investor to professional managers.
Chapter four places restriction on using bank of financial institut name or carrying out financial transactions
by institutions other
those licensed by NRB as per the ordinance.
Chapter five deals with capital adequacy, reserve and provisioning NPA’s. But the more it has tried to be transparent, the more it has
discretionary powers with NRB. To protect the interest of depositors,
prime concern of legislatures in drafting the law should be contin
maintenance of adequate capital and such an important matter should Reading Previewshould be learnt from the be left to the discretionYou're of NRB. Thea lesson
Unlock full access with a free trial. experience where NRB’s leniency sent two largest banks technic
bankrupt. In this regard, it mayWith beFree pertinent to remind why the Download Trial
Committee recommendation on capital adequacy (that is univers
acceptable) is not being made mandatory obligation on the part of promoters is not created to meet the capital gap within specified
Such an obligation is vital for protecting the depositor’s interest. As it Sign up to vote on this title
been the cases with the two largest banks (i.e; Nepal Bank Ltd.
Useful
Not useful
Rastriya Banijya Bank) and a few other private sector banks in Ne
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
modern banking like debt securitization swap and hedge transactions
dealing in other financial derivatives. The finance company will
benefited with this ordinance as they are now authorized to accept inte free deposit.
Regulatory, inspection and supervision responsibility with regard
financial institutions continue to remain with NRB. The new provis
has enlarged the scope of NRB’s regulatory role. Banks set up w foreign shareholding will now be required to submit to NRB
inspection reports prepared by their headquarters. Severe pen
including suspension of board or taking over the management of finan
institutions has been prescribed if the result of NRB inspection indic non-compliance with its directives or if the financial institutions found to be guilty of engaging in activities that are detrimental to You're Reading a Preview
interest of the shareholders or the depositors. Unlock full access with a free trial.
The deregulated interest rate regime appears Download With Free Trial to be drifting away as
ordinance has empowered NRB to intervene in rate fixation but it d
not specify the conditions that would oblige NRB to do so. Looking at
current rate of interest offered on deposit on financial institutions that
gone below the inflation rate. NRB intervention could bring relie Sign up to vote on this title
thousands of small depositors especially old, disabled and pensio
whose lifetime saving is at stake.
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
identified. The authority of financial institutions in loan recovery
been extended and it may now reach to other assets of the borrowe
case the security for loan falls short or becomes inadequate. The hith requirement of disposal of non-banking assets within seven years
been done away with. It may result in accumulation of signifi
unproductive assets in F\s balance sheet. The role of Loan Recov
Tribunal has been undermined and no role is envisaged for A Management Company that is in the offing.
The role of the auditor of financial institutions has been extended an
goes beyond the scope of expertise of accounting profession. Audi
shall require among others, to certify whether financial institutions h acted (or failed to act) to protect the interest of depositors or investor
whether the business of financial institutions has been conduc You're Reading a Preview
satisfactorily. Basis of such option is not outlined and accordingly it Unlock full access with a free trial.
serve to purpose other than becoming a ritual. Download With Free Trial
Chapter ten deals with merger that permits financial institutions o
This is a new provision but does not prescribe the circumstances w such merger will be permitted. The missing part on merger is
safeguard of interest of minority shareholders. It does not en Sign up to vote on this title
shareholders opposed to the merger to ask for compulsory acquisition
is vital for promoting foreign investment.
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
depositor’s right is clearly protected by reiterating that there would be
other claimant on deposit kept with financial institutions other t
depositor himself of his nominee but with such right. The state m interfere in one or other pretext defeating the intension of law lessening the confidence in the banking system.
For the first time, the law has taken cognizance of international terror
and NRB is empowered to suspend operation of account related organization or individual associated with such activity. But it
omitted any anti-money laundering provision. Probably, a separate ac being envisaged to deal with such transaction. In conclusion, it could be said that the ordinance is comprehensive
deals with significant aspect of operation of financial instituti
You'rebe Reading Preview However, attempts should madeato limit NRB’s discretionary po Unlock full access with a free trial. by farming transparent, prudent and unambiguous policies
regulations. Further work wouldWith beFree necessary to integrate the count Download Trial
financial sector with international financial sector with internatio
financial market and effort should be directed to encourage adoptio
international bet practices like International Financial Repor
Standards (IFRS), International Standards on Auditing (ISA). Ba Committee Recommendation etc.
Sign up to vote on this title
Useful
Not useful
Raja Ram Khadka (1998) “A study on the Investment Policy of N
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
operation than that of NGBL and NIBL. In case of profitability ratio
has concluded that of other joint venture banks (JVBs). NABIL is m
successful in deposit utilization but fails to maintain high growth rat profit in comparison with NGBL and NIBL.
He has recommended that NABIL bank should increase cash and b balance to meet loan demand. NABIL’s loan and advances to deposits ratios are lower than that of other JVBs to overcome
situation, NABIL is strongly recommended to follow liberal lend
policy and invest more and more percentage amount of total deposit loans and advances. He has focused his study on the investment policy of NABIL bank has taken NGBL and NIBL average ratios as banking average.
You'reto Reading Khadka has recommended adopta Preview liberal lending policy however
Unlock full access with a free trial. not explained regarding liberal lending and invest more and m
percentage amount of Download total deposits inTrial loans and advances. Howe With Free while adopting liberal policy on lending he has not explained
consequences like bad debt, default loan, which may arise due to v flexible and liberal lending policy (Khadka, 1998).
Lila Prasad Ojha (2002) on “Lending Practices: A study on Nabil B Sign up to vote on this title
Useful and Not useful Ltd, Standard Chartered Bank Nepal Ltd Himalayan Bank Ltd.”
found out that the measurement of lending strength in relative term
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
Nabil ratio to be the highest. The ratio of loans and advances
investment to deposits ratio has measured the proportion of total depo that is used to increase the income of the banks irrespective of
portfolios of its application. Nabil has deployed the highest proportio
its total deposits in earning activities and this ratio is significantly ab
the ratio of other two banks. The combine ratio is highly deviated f
the mean ratio of Nabil and SCBNL. This is the indicative of that in f mobilizing activities Nabil is significantly better than SCBNL.
He has further concluded that the overall liquidity strength of SCBNL be considered the best among the banks. However the liquidity
arising from interest rate in SCBNL is the most likely. Since the mark
highly sensitive toward the interest rate and SCBNL has generally b
offering low interest rate as compare to other banks. The analysi You're Reading a Preview
lending strength of HBL in loan and advances is the best. However l Unlock full access with a free trial.
and advances, investment to deposit ratio have upgraded the performa Download With Free Trial
of Nabil. If HBL succeeded in collecting the less cheaper sources of f
infuture, the lending strength of HBL would push the performance
Nabil and SCBNL far behind in the coming future. Also the contribu
made by HBL in the productive sector of economy is highly apprecia
gro and the best among these three commercial banks. The highest Sign up to vote on this title
Not useful and the Useful rate, proportionately high volume of loans and advances
contribution in agriculture and priority sector and the high leve
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
of productive sector loan of Nabil has put this bank in the top positio absolute term.
On the basis of the findings and conclusions he has recommended for
banks as the liquidity position of all these three banks is found to be h He has recommended the banks to look upon new area of lending
investment. The rural economy has always been realizing the credit ne
and the dominance of non-organized moneylender in this area has b prevailing. To compromise between the liquidity and credit need of
economy these banks are highly recommended to expand their cred this area. SCBNL’s contribution in loans and advances is the lowest
this has low degree of variation and low growth rate as compare to N and HBL. SCBNL is recommended to give extra priority sector loan.
increasing provision on loan loss and high volume of non-perform You're Reading a Preview
assets in Nabil and HBL certainly attracts the high attraction of Unlock full access with a free trial.
person interested with these banks. The high volume of HBL Download With Free Trial
performing assets may have caused due to the failure of industrial
agricultural sector. Nabil’s increased non-performing assets may h
caused due to the accumulated bad debts that is kept behind the curtai show the efficiency of management. Sign up to vote on this title
He has used different tools like standard deviation, correlation, tr
Useful
Not useful
analysis and financial tools for the data analysis and presentation. In
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
Gautam (2002) “Lending Practices and Procedures of Nepal Banglad Bank Limited” has outlined his major findings as follows.
Not concentrating only in big cities and large groups he has suggested
Bank to expand branches in rural areas. Banks should invest in produc
sector, develop the concept of micro financing and group financing m
should maintain the balance in its loan portfolio and current requirem
of the customers. Banks should give preference to the short term lend
Banks should provide the consortium loan for those projects un
government guarantee and security thereby uplifting the econo condition of the country (Gautam, 2002). Subi Joshi (2003) on “ Financial Analysis of NIBL” has found out
the analysis of the banks shows that the deposit have been increas
You're Reading a Preview gradually during the study period i.e.; (2053/54 – 2057/58). However
Unlock full access with a free trial. rate of increase was comparatively low in the year 1997/98 than in
year 2000/01. Total loans and advances have been also increasing. Download With Free Trial
total investment of bank has been increasing over the years, whic
mainly due to bank strategy of safe lending. As a result of increas
customer deposits and limited opportunities for prudent lending. As
loan and advances from the bank is increasing provision for loan loss Sign up to vote on this title
also been increasing. The bank has been holding adequate provision
Useful
Not useful
losses over the years and the general loan loss provision was 4%
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
evaluate credit risk by considering well-known 5C’s of credit character, capacity, capital, collateral and conditions. The financial analysis of NIBL has been analyzed and interpreted in
thesis. Analysis on terms of loan and advances is simply presented w
comparison with the previous year data only. On the loans and advan part, it has only simple comparison been done. Whether the classification and provisioning of loans, investment in priority
deprived sector loan investment regulation of NRB’s directives has b followed or not has not been explained.
A study conducted by Niva Shrestha (2004) on the topic “A study on
performing loans and loan loss provisioning of commercial ban
revealed that SCBNL had risk averse attitude of the management or t
You're a Preview have policy of investing lowReading in the risky assets i.e; loan and advance
full access with a free trial. compared to NBL and Unlock Nabil because the loan and advances to total a
ratio of NBL, Nabil andDownload SCBNLWith during the study period was appeare Free Trial be 52.3%, 47%, and 29.34% respectively. The SCBNL has proportion of the investment in risk free or nominally risky asset
treasury bills, National saving bonds. Similarly, the loans and advance total deposit ratio of NBL, Nabil and SCBNL during the study period Sign up to vote on this title
found to be 57.63%, 56.35%, and 35.94% respectively. It indicates
Useful
Not useful
SCBNL has the most consistent and variability during the study pe
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
total loan of NBL, Nabil and SCBNL was found to be performing lo
Not only the public sector bank, even private sector bank like Nabil
higher proportion of non-performing loan. However, in recent years N
has shown significant decrement in non-performing asset, which are
result of effective bank credit management and its efforts of recove bad debts through the recovery of establishment of recovery cell.
In the same way, proportion loan loss provision of NBL was found to
significantly higher (i.e; 40.17%) as compared to other two commer banks. The proportion of Nabil and SCBNL was found to be 5.69% 4.49% respectively.
The average ratio of provision held to non-performing loan of N
Nabil and SCBNL was found to be 80.03%, 57.85% and 122.3
You're a Preview respectively shows that the Reading SCBNL has maintained adequate leve Unlock full access with a free trial. provision against non-performing loan whereas Nabil was found
comparatively lower. The NBLWith was found Download Free Trial to be an average posit (Shrestha, 2004).
The review of above relevant literature has contributed to enha
fundamental understanding and knowledge, which is required to m
this study meaningful and purposive. There has been lotsof art Sign up to vote on this title
Useful Not usefulof commer published related to investment policy, loan and advances
banks. There are various researches conducted on investment analysis
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
study of credit management of selected commercial banks will be the study between the banks in the subject matter. 2.3
Research Gap
The purpose of this research is to development some expertise in o
area, to see what new contribution can be made and to receive so
ideas, knowledge and suggestions in relation to credit managemen
selected commercial banks (i.e; Nabil Bank Ltd. and Standard Chart
Bank Nepal Ltd.). Thus, the previous studies cannot be ignored beca
they provide the foundation to the present study. In other words, there
to be continuity in research. This continuity in research is ensured
linking the present study with the past research studies. Here, it is c
that the new research cannot be found on that exact topic, i.e
You're Reading a Preview comparative study on credit management of commercial banks in Ne Unlock full access with a free trial. Therefore, to fulfill this gap, this research is selected. To complete
research work, many books, journals, articles Download With Free Trial and various published
unpublished dissertation are followed as guideline to make the resea easier and smooth. In this regard, here we are going to analyze
different procedure of credit management, which is considered only Nabil Bank Limited and Standard Chartered Bank Nepal Limited. Sign up to vote on this title
main research problem is to analyze whether these two commercial ba
Useful
Not useful
have right level of credit efficiency as well as are able to manage
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
CHAPTER – III
RESEARCH METHODOLOGY 3.1
Introduction
Research in common sense refers to a search for knowledge. O can also define research as a scientific and systematic search
pertinent information on a specific topic. In fact, research is an ar scientific investigation. The Advance Learner’s Dictionary
current English lays down the meaning of research as “a care investigation or inquiry specially through search for new facts in branch of knowledge”. Redman and Money define research
“Systematized effort to gain new knowledge”. Some people consi research as a movement, a movement You're Reading a Preview from the known to
unknown. It is actually a voyage ofadiscovery, we all posses the v Unlock full access with free trial.
instinct of inquisitiveness makes us probe Download With Free Trial and attain full and fu
understanding of the unknown. This inquisitiveness is the mothe
all knowledge and the method, which man employs for obtaining knowledge of whatever the unknown, can be termed as research. In this chapter, research methodology adopted for achieving Sign up to vote on this title Not usefulstatistical Useful predetermined objectives are specified. The various
financial instruments will be used for the purpose. It counts on
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
3.2
of 131
Non Performong Assets Project
Banking Statement
Search document
Research Design
The crux of this chapter is to analyze the credit practice and cre
efficiency of Nabil Bank Limited and Standard Chartered B
Nepal Limited. Decision regarding what, when, how, by what me
concerning an enquiry of a research study constitute a resea design. “A research design is the arrangement of conditions
collection and analysis of data in manner that aims to comb
relevance to the research purpose with economy in procedure”
fact, the research constitutes the blueprint of the collecti
measurement and analysis of data. As such the design includes
outline of what the researcher will do from writing the hypothe and its operational implications to the final analysis of data. You're Reading a Preview
Unlock full access a free trial. A research design, bearing the with techniques and systematic steps
research, helps to collect various information required to researc Download With Free Trial
for thesis writing or any investigation. In the lack of the resea
design, the functional process on research is never achieved. “A
the research study has been formulated, the next logical steps are
construct the research design which refers to the entire process Sign up to vote on this title
planning and carrying out a research study. Not useful design UsefulThe research
what approach to the problem should be taken? What method wil
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
3.3
of 131
Non Performong Assets Project
Banking Statement
Search document
Sources of Data
Necessary data are collected from both sources primary secondary survey.
Secondary sources of data are the information collected from boo
journal, newspaper, reports and dissertations etc. The major sour of secondary data are as follows:
Economy survey of Nepal Government, Ministry of Financ NRB Directives.
Banking and Financial Statistic.
Central Bureau of Statistic.
Annual General Report of NABIL.
Annual General Report of SCBNL.
You're Reading a Preview
Unlock full access with a free trial.
3.4
National Newspaper, Journals and Magazine. Internet.
Download With Free Trial
Population and Sample
A population refers to the total size of any object. Rather th
collecting information from each member, a sub-group is cho Sign up to vote on this title
which is believed to be representativeof population. This sub-gr Useful
Not useful
is called a sample and the method of choosing this sub-group is d
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
3.5
of 131
Non Performong Assets Project
Banking Statement
Search document
Method of data Analysis Technique
For the purpose of the study, all collected primary as well
secondary data are arranged, scanned, tabulated under various he and then after disunities and statistical analysis have been carried to enlighten the study. 3.5.1 Financial Method
“Financial Analysis is the starting point for making plans bef
using any sophisticated forecasting and budgeting procedure Hence ratio analysis is used under financial analysis to attain result after tabulating the data. (Pandey, 1999: 108)
A ratio is a quotient You're of theReading mathematical a Preview expression, establishm
Unlock access with a free trial. of quantitative relation of full data furnished by the financial statemen
called ratio analysis.Download In other words, With Free Trial a financial ratio is
mathematical expression of relationship of two accounting figure
helps in taking decision science it helps to establish relations
among various ratios and interpretation there on, inter f comparison and comparison between past and present ratios for Sign up to vote on this title
same firm gives enormous and fruitful results Not test useful the finan Useful to
performance. One author has said that to evaluate the finan
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
of the firm then they would obtain from analysis of financial d alone. (Van Horne, 1997: 759) 3.5.1.1 Credit Practices Ratios •
Total Loan to total deposit ratio
This ratio is calculated to find out how successfully the banks
utilizing their deposits on loan and advances for profit generat
activities, greater the ratio indicates the better utilization of to deposits. It is calculated as: Total loan to deposit ratio = •
Total Loan Deposits
Reading a Preview ratio Interest incomeYou're to loans & advances Unlock full access with a free trial.
Interest income to loan and advances is one of the major sources of income for a Free Trial commercial bank. The highDownload volume ofWith interest income is indicator of good performance of lending activities. This ratio is calculated as:
Interest income to loans & advances =
•
Interest Income Loan & Advances
Non-performing loans to total loan & advances ratio
Sign up to vote on this title
Useful
Not useful
NRB has directed all the commercial banks create loan loss provision against the
doubtful and bad debts. But both of our concerned banks have not provided data o
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non-performing
loans
to
Non Performong Assets Project
Banking Statement
Search document
total
loan
&
advances
ratio
Non-performing loan Total loan & advances •
Loans and advances to total assets ratio
Loan and advances is the major part of total assets for the bank. This ratio indicate
the volume of loans and advances out of the total assets. A high degree of the ratio
indicates that the bank has been able to mobilize its fund through lending function is calculated as:
Loans and advances to total assets ratio = •
Loan and advances Total assets
Loan and advances to current assets ratio
Loan and advances is the major component in total assets, which indicates the abil
of banks to canalize its deposit in Reading the formaofPreview loan and advances to earn high retur You're
sufficient loan and advances cannot be granted, it should pay interest on those util Unlock full access with a free trial.
deposit fund and may lose earnings. So commercial banks provide loan and advan Download With Free Trial in appropriate level to find out portion of current assets, which is granted as loan a
advances. Loan and advances includes short-term loan and advances, overdraft, ca credit, local and foreign bills purchased and discounted. It is calculated as:
Loan and advances to current assets ratio =
Loan and advance Current assets
Sign up to vote on this title
•
Usefulratio Not useful Loan loss provision to total loan & advances
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
quality of assets in total volume of loan and advances. High ratio indicates more ri assets in total volume of loan and advances. It is calculated as:
Loan
loss
provision
to
total
loan
&
advances
ratio
Loan loss provision Total loan & advances 3.5.1.2 •
Credit Efficiency Ratios Total assets to liabilities ratio
The total assets of the bank should play active role in profit generating through
lending activities. Banks create credit through loans and advances and multiply th
assets much more times than their liability permits. This ratio measures the ability
bank to multiply its liability into assets. The higher ratio is favorable as it increase overall capacity of the organization. This is calculated as: You're Reading aTotal Preview assets
Total assets to liabilities ratio =
Unlock full access with aLiabilities free trial.
•
Withratio Free Trial Interest expense toDownload total deposit
This ratio measures the percentage of total interest paid against total deposit. A hi ratio indicates higher interest expenses on total deposit. Commercial banks are dependent upon its ability to generate cheaper fund. The cheaper fund has moved probability of generating loans and advances and vice versa. It is calculated as: Sign up to vote on this title
Not useful Interest Expenses Interest expenses to total deposit ratio = Total Deposits Useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Search document
Interest expenses to total expenses ratio = •
Banking Statement
Interest expenses Total expenses
Non-interest bearing deposits to total deposit ratio
This ratio measures the volume of non-interest bearing deposits to total deposit. T
volume of interest expenses in total expenses represents a large portion of the tota
expenses. How efficiently the deposits were managed affectively in the total volum
of expenses. The higher ratio is favorable but in practices, interest bearing deposit
always plays a significant role in the mix of deposit liability. This is calculated as:
Non-interest bearing deposits to total deposit ratio =
•
Non-Interest bearing depsoit Total Deposits
Interest income to total income ratio
This ratio measures the volume of interest income to total income. The high ratio
indicates the high contribution made by lending and investment whereas low ratio You're Reading a Preview indicates low contribution made by lending and investment and high contribution Unlock full access with a free trial.
other fee based activities in total income. This is calculated as: Download With Free Trial
Interest income to total income ratio = •
Interest income Total income
Interest from loan, advances and overdraft to total interest income ra
This ratio measures the contribution made by interest from loan, advances and Sign up to vote on this title
overdraft. Loan and advances generate the major portion of interest income. Henc
Useful
Not useful
this ratio measures how efficiently the banks have employed their funds and loan & advances and overdraft. It is calculated as:
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Interest suspense means that portion of interest, which is due but not collected. Th ratio measures the composition of due but uncollected interest in the total interest income from loan and advances. The high degree of this ratio indicates the low
interest turnover and low degree of this ratio indicates high interest turnover. This
ratio also helps to analyze the capacity of the bank in collecting the repayments of loan and advances. It is calculated as:
Interest suspense to interest income from loan & advances ratio
Interest suspense = Interest income from loan & advances 3.5.2 Statistical Method
For supporting the study, statistical tools such as mean, stand
deviation, correlation, regression analysis and ANOVA tools have b used under this.
You're Reading a Preview
Unlock full access with a free trial. 3.5.2.1 Arithmetic mean (Average)
Download With Free Trial
Arithmetic mean also called “the mean” or as the most popular a
widely used measure of central tendency. Arithmetic m represents the entire data by a single valve. It provides the gist
gives the birds eye view of the huge mass of un widely numer data. It is calculated as:-
Sign up to vote on this title
X=
∑x
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
3.5.2.2 Correlation
Correlation may be defined as the degree of liner relations
existing between two or more variables. There variable are said to
correlated when the change in the valve of one results change another variable. Correlation may be:-
Simple or partial or multiple correlation
-
Position or negative or zero correlation
-
Linear or non-linear correlation
-
Perfect or non-perfect correlation
It is calculated as:-
r xy =
N∑ xy -Reading ∑x.∑ya Preview You're 2 2 2 2 N∑x - (Unlock N∑with y -a free (∑trial. y) ∑x) full access
Formula of correlation
Download With Free Trial
Where, r xy = correlation between x & y N∑xy
= product of no. of observation and sum of product of x & y
∑x∑y
= product of sum of X and sum ofSign Y up to vote on this title
3.5.2.3 Co-efficient of Determination
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
CHAPTER – IV
PRESENTATION AND ANALYSIS OF DATA
Presentation and analysis of data is very important stage of resea study. Its main purpose is to change the unprocessed data
understandable form. It is the process of organizing the data by tabula
and then placing that data in presentable from by using various tab figures and sources.
Credit management is one of the most important factors that have b
developed to facilitate effective performance of bank management. Cr management is the formal expression of the commercial banks' goals
objectives stated in financial term for specific future period of ti Credit is the very basic indicator for determining profit.
The main purpose of the objective is to assess the comparative cr
management in selected commercial banks. Present chapter will disc the
various
aspects
of
credit
management
and
their
ac
accomplishment. Actually, credit management is a fundamental mate tool, which is applied in commercial banks. For this respect, it
analyze the data by using various financial and statistical tools to meet
selec stated objectives of the study. It also compares Sign up tothe vote data on thisbetween title useful Useful Not banks. Besides, it also presents the various funding generated from
analysis.
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
resources. Financial analysis can also be used to assess the compa
liability as and ongoing enterprise and determine whether a satisfac
return is being earned for the risks return. Thus, comparative conditio the banks in terms of credit practices is necessary to find out comparative credit practices in those banks.
For research purpose, financial conditions of both the banks in term
credit practices, credit efficiency has analyzed the comparative cr position in selected commercial banks.
4.1.1 Comparative Credit Practices in Nabil Bank and Stand Chartered Bank
Comparative credit practices show the comparative lending policies practices adopted by the selected commercial banks during the period. It measures the ability of the organization in terms of practices by using historical data. i.
Total Loans to Deposit Ratio
The main source of bank's lending depends on its deposit. This rati
calculated to find out how successfully the banks are utilizing t
deposits on loan and advances for profit generating activities greater r Sign up to vote on this title
Not useful UsefulThe ratios indicates the better utilization of total deposits. ar e presente
the following table.
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
of 131
Non Performong Assets Project
Banking Statement
Search document
Table 4.1 shows that the ratio of credit to deposit ratio in NABIL 0.5031, 0.6034, 0.6055, 0.7505 and 0.6863 respectively. Whereas
ratio of SCBNL is 0.3597, 0.3199, 0.3163, 0.4349 and 0.3 respectively. In overall comparison, NABIL has the highest ratio is 2004/05 i.e. 0.7505 and SCBNL has observed the lowest ratio in 2003/04 with 0.3163. From mean point of view, NABIL has maintained higher loan advances to total deposit ratio than SCBNL. In this way, it shows NABIL seems to be strong to mobilize its total deposit as loan
advances. It can be concluded that SCBNL has lower position to mobi
its deposits as compare to NABIL. However higher ratio does not mea
is always better from the point of liquidity. From the analysis NAB
seems to be the best performer in utilizing its collected resources in
form of deposits much efficiently, which may definitely increase income and profit for NABIL. Figure 4.1 Total Loans to Deposit Ratio 0.8 0.7 0.6
Sign up to vote on this title
0.5 o i t a 0.4
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
ii.
of 131
Non Performong Assets Project
Banking Statement
Search document
Interest Income to Loans and Advances
Interest income to loan and advances is one of the major source
income for a commercial Bank. The high volume of interest incom indicator of good performance of lending activities. Table 4.2 Interest Income to Loans and Advances
Bank/F.Y. 2001/02 2002/03 2003/04 2004/05 2005/06
M
NABIL
0.1034
0.0983
0.0945
0.0870
0.0829
0.09
SCBNL
0.1031
0.1011
0.0883
0.0743
0.0623
0.08
Table 4.2 shows that the ratio of interest income to loan advances ratio in NABIL is 0.1034, 0.0983, 0.0945, 0.0870 0.0829 respectively. Likewise, the ratio of SCBNL is 0.10 0.1011, 0.0883, 0.0743 and 0.0623 respectively. But NABIL has You're Reading a Previewand SCBNL has the low highest ratio in FY 2001/02 i.e. 0.1034 ratio in FY 2005/06 i.e. 0.0623 Unlock full accessrespectively. with a free trial.
Calculated mean valueDownload of NABIL highest WithisFree Trial with 0.0932 as compar
SCBNL, which is 0.0858 respectively. From this point of view NA has the best performance in earning interest income.
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Figure 4.2 Interest Income to Loans and Advances 0.8 0.7
0.6 0.5 o i t 0.4 a R
0.3 0.2 0.1 0 2001/02
2002/03
2003/04
2004/05
2005/06
Fiscal Year
NABIL
SCBNL
You're Reading a Preview Unlock full access with a free trial.
iii.
Non-Performing Loans to Total Loan and Advances Ratio Download With Free Trial
NRB has directed all the commercial banks create loan loss provi
against the doubtful and bad debts. But our concerned banks have provided data on non-performing loan in balance sheet and profit &
A/C. To measure the volume of non-performing loan to total loan Sign up to vote on this title
advances the main indicator of NABIL and SCBNL has been used. T
Useful
Not useful
ratio shows the percentage of non-recovery loans in total loans
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Table 4.3 shows that from the NABIL point of view, the ratio in five y
are 0.0714, 0.0554, 0.0335, 0.0132 and 0.0138 respectively. Likewise
ratios of SCBNL are 0.0485, 0.0413, 0.0377, 0.0269 & 0.0
respectively. In overall comparison, NABIL has both the highest rati
F/Y 2001/02 i.e. 0.0714 and the lowest non-performing loan to total l and advances ratio in F/Y 2004/05 i.e. 0.0132 respectively.
From the mean point of view, it can be said that SCBNL has
lowest ratio than NABIL. Banking sector is seriously affected by the n performing loan. Both banks are not far from this above fact. If
performing loan increases, the overall banking business will be affec
So provision amount will increase and profit will decrease. So, i
suggested the NABIL Banks to be very careful while granting loan an do effective follow up for recovery of non-performing loan. You're Reading a Preview
Unlock full access with a free trial.
Figure 4.3
Non-Performing to Total DownloadLoan With Free Trial and Advances
0.08 0.07 0.06 0.05 o i t 0.04 a R
0.03
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
iv.
of 131
Non Performong Assets Project
Banking Statement
Search document
Loans and Advances to Total Assets Ratio
Loan & advance is the major part of total assets for the bank. The r
indicates the volume of loans & advance out of the total assets. A h
degree of the ratio indicates that the bank has been able to mobilize
fund through lending function. However lending always carries a cer risk of default. Therefore a high ratio represent low liquidity and
ratio represents to productivity with high degree for safety in term liquidity. Table 4.4 Loan Advances to Total Assets Ratio
Bank/F.Y. 2001/02 2002/03 2003/04 2004/05 2005/06 NABIL
0.4219
SCBNL
0.2908
M
0.4683
0.4891
0.6160
0.5787
0.51
0.2712
0.2711
0.3719
0.3467
0.31
You're Reading a Preview Unlock full access with a free trial.
Download With Free & Trial Table 4.4 shows that the ratio of loans advance to total assets in
year for NABIL 0.4219, 0.4683, 0.4891, 0.6160 and 0.5787 respectiv Similarly, the ratio of SCBNL is 0.2908, 0.2712, 0.2711, 0.3719 0.3467 respectively.
From the mean point of view, it can be said mean ratioof NA Signthat up to the vote on this title
Useful that Not useful has the highest than SCBNL. It can be concluded the higher m
ratio indicates the good lending performances. So NABIL bank has g
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Figure 4.4 Loan Advances to Total Assets Ratio 0.7
0.6
0.5
o i t a R
0.4
0.3
0.2
0.1
0 2001/02
2002/03
2003/04
2004/05
2005/06
Fiscal Year
NABIL
SCBNL
You're Reading a Preview Unlock full access with a free trial.
v.
Loan and Advances to Current Assets Ratio Download With Free Trial
Loan & advances is the major component in total assets, which indic
the ability of banks to canalize its deposit in the form of loan & advan
to earn high return. If sufficient loan and advances cannot be grate
should pay interest on those utilized deposit funds and may lose earni Sign up to vote on this title
So commercial banks provide loan & advances in appropriate leve
Useful
Not useful
find out portion of current assets, which is granted as loan and advance
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
of 131
Non Performong Assets Project
Banking Statement
Search document
Table 4.5 shows that, from the NABIL point of view, the ratio for
years are 6.867, 4.273, 4.335, 7.414 and 5.464 respectively. Similarly,
ratio of SCBNL are 1.858, 1.797, 1.511, 2.416 and 3.465 respectively
overall comparison NABIL Bank has the highest loan and advance
current assets ratio (i.e. 7.414) in FY 2004/05 and SCBNL has the low ratio (i.e. 1.511) in FY 2003/04.
From the mean point of view, NABIL has the higher mean ratio
comparison with SCBNL. It indicates that NABIL Bank has relativ better short term lending practices than SCBNL. Figure 4.5 Loan to Advances to Current Assets Ratio 8
You're Reading a Preview
7
Unlock full access with a free trial.
6
Download With Free Trial
5 o i t 4 a R
3 2 1 0 2001/02
2002/03
Sign 2003/04
up to vote on this title 2004/05
Useful
Fiscal Year
NABIL
SCBNL
Not useful
2005/06
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
financial conditions of banks of controlling the credit risk and reduced risks related to deposits.
The low ratio indicates the good quality of assets in total volume of l
& advances. High ratio indicates move risky assets in total volume loan & advances. Table 4.6 Loan Loss Provision to Total Loan & Advances Bank/F.Y. 2001/02
2002/03
2003/04
2004/05
2005/06
M
NABIL
0.0489
0.0461
0.0438
0.0340
0.0275
0.04
SCBNL
0.0619
0.0534
0.0442
0.0340
0.0303
0.04
Table 4.6 shows that, from the NABIL point of view, the ratio of l
loss provision to total loans & advances in five year are 0.0489, 0.04 You're Reading a Preview
0.0438, 0.0340 and 0.0275 respectively. Whereas the ratio of SCBNL Unlock full access with a free trial. 0.0619, 0.534, 0.0442, 0.0340 and 0.0303 respectively. But SCBNL Download With Free Trial
the highest loan loss provision to loan and advances ratio (i.e. 0.0619
FY 2001/02 and NABIL has the lowest ratio (i.e. 0.0275) in FY 2005/
From the mean point of view, it can be said that SCBNL has high l
loss provision in comparison with NABIL. From the above calculatio Sign up to vote on this title
can be said that the increase ratio indicates the increased volume of n
Useful
Not useful
performing loans. The increasing loan loss ratio indicates the poor
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Figure 4.6 Loan Loss Provision to Total Loan & Advances 0.07
0.06
0.05
o i t a R
0.04
0.03
0.02
0.01
0 2001/02
2002/03
2003/04
2004/05
2005/06
Fiscal Year
NABIL
SCBNL
You're Reading a Preview Unlock full access with a free trial.
4.1.2 Comparative Credit Efficiency of NABIL Bank and Stand Download With Free Trial
Chartered Bank
It measures the effectiveness of activity of the company thro establishing the relationship between the various assets and credit of respective organization. Sign up to vote on this title
i.
Total Assets to Liabilities Ratio
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Table 4.7 Total Assets to Liabilities Ratio
Bank/F.Y. 2001/02 2002/03 2003/04 2004/05 2005/06 Mea NABIL
1.0696
1.0862
1.0971
1.1067
1.0917
1.09
SCBNL
1.0188
1.0697
1.0675
1.0779
1.0730
1.06
Table 4.7 shows that ratios of the banks’ total assets to liabilit NABIL has the higher mean ratio than SCBNL. The combined m ratio is 1.0759 and NABIL has higher ratio than that of the combi mean. NABIL has been able to utilize the fund more efficiently a effectively to the extend in comparison with the SCBNL, howe still this position could not be sufficient balance for a develop country the ratio should not be below. Figure 4.7 Total Assets to Liabilities Ratio You're Reading a Preview 1.12
Unlock full access with a free trial. 1.1
Download With Free Trial
1.08 1.06 o i t 1.04 a R
1.02 1 0.98
Sign up to vote on this title
0.96 2001/02
2002/03
Useful
2003/04 Fiscal Year
Not useful 2004/05
2005/06
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
ii.
of 131
Non Performong Assets Project
Banking Statement
Search document
Interest Expenses to Total Deposit Ratio
This ratio measures the percentage of total interest paid against t
deposit. A high ratio indicates higher interest expenses on total dep
Commercial Banks are dependent upon its ability to generate chea fund. The chapter fund has moved the probability of generating loans advances and vice versa. Table 4.8 Interest Expenses to Total Deposit Ratio Bank/F.Y. 2001/02
2002/03
2003/04
2004/05
2005/06 Mea
NABIL
0.0291
0.0209
0.0197
0.0168
0.0209
0.02
SCBNL
0.0182
0.0135
0.0130
0.0131
0.0131
0.01
Table 4.8 shows that You're the cost of the deposit of NABIL is found Reading a Preview decreasing trend till FY 2004/05. It has highest ratio in FY 2001 Unlock full access with a free trial. i.e. 0.0291 and lowest ratio is FY 2004/05 i.e. 0.0168. Simila SCBNL has the highest ratio in FY 2001/02 i.e. 0.0182 and low Download With Free Trial ratio in FY 2003/04 i.e. 0.0130. The ratios are found in decreas and increasing trend.
From mean point of view, it can be said that SCBNL has low inte expenses to total deposit ratio than NABIL. Thus, it can be said SCBNL is successful to collect cheaper deposit than NABIL. Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Figure 4.8 Interest Expenses to Total Deposit Ratio 0.035
0.03
0.025
o i t a R
0.02
0.015
0.01
0.005
0 2001/02
2002/03
2003/04
2004/05
2005/0
Fiscal Year
NABIL
SCBNL
You're Reading a Preview Unlock full access with a free trial.
iii.
Interest Expenses to Total Expenses Ratio Download With Free Trial
This ratio measures the percentage of interest paid against total expen The high ratio indicates the low operational expenses and vice versa. ratio indicates the costly sources of funds. Table 4.9
Sign up to vote on this title
Useful Not useful Expenses Interest Expenses to Total Ratio
Bank/F.Y. 2001/02
2002/03
2003/04
2004/05
2005/06
M
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
From mean point of view, it can be said that SCBNL has low inte
expenses to total expenses ratio than NABIL. Thus, it shows that decre
in cost of the deposits, the volume of interest expenses ratio has b decreasing. Figure 4.9 Interest Expenses to Total Expenses Ratio 0.035
0.03
0.025
o i t a R
0.02
0.015
0.01
0.005
You're Reading a Preview
0
Unlock full access with a free trial. 2001/02
2002/03
2003/04
2004/05
2005/0
FiscalTrial Year Download With Free
NABIL
iv.
SCBNL
Non-Interest bearing Deposits to Total Deposits Ratio Sign up to vote on this title
This ratio measures the volume of non-interest bearing deposits to t
Useful
Not useful
deposit. The volume of interest expenses in total expenses represen
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Bank/F.Y. 2001/02
Non Performong Assets Project
Banking Statement
Search document
2002/03
2003/04
2004/05
2005/06
M
NABIL
0.2027
0.2547
0.2134
0.2153
0.1693
0.21
SCBNL
0.2544
0.3193
0.2845
0.2375
0.2251
0.26
Table 4.10 shows that non-interest bearing deposits to total deposi NABIL Bank are in fluctuating trend. NABIL has highest ratio
2002/03 i.e. 0.2547 and lowest ratio in FY 2005/06 i.e. 0.1693. Whe
SCBNL has highest ratio in FY 2002/03 i.e. 0.3193 and lowest ratio FY 2005/06 i.e. 0.2251. It has ratios in fluctuating trend also.
From the mean point of view, it can be said that Standard Chartered B
has highest mean ratio than NABIL Bank. In this way, the dep
mixture of Standard Chartered Bank carries the highest level of inte
bearing deposits in its deposit mixture. This indicates that Stand a Preview Chartered Bank is the You're most Reading successful in collecting cheapest fund. Unlock full access with a free trial.
major portion of non-interest bearing deposit consists of current depo Download With Free Trial and this deposit is particularly maintained by business enterprises.
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Figure 4.10 Non-Interest bearing Deposits to Total Deposits Ratio 0.35
0.3
0.25
o i t a R
0.2
0.15
0.1
0.05
0 2001/02
2002/03
2003/04
2004/05
2005/06
Fiscal Year
NABIL
SCBNL
You're Reading a Preview Unlock full access with a free trial.
v.
Interest Income to Total Income Ratio Download With Free Trial
This ratio measures the volume of interest income in total income.
high ratio indicates the high contribution made by lending and investm whereas low ratio indicates low contribution made by lending
investment and high contribution by other fee based activities in t income.
Sign up to vote on this title
Table 4.11
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
FY 2005/06 i.e. 0.7282 and the lowest ratio in FY 2001/02 0.6835. Likewise, the ratio of SCBNL in five years are 0.70 0.6658, 0.6580, 0.6871 and 0.6693 respectively whereas the high ratio in FY 2001/02 i.e. 0.7008 and lowest ratio in FY 2003/04 0.6580.
From mean point of view, it can be said that NABIL has high inte
income to total income ratio than SCBNL. This shows that, in t
income of NABIL Bank and Standard Chartered Bank, interest inco
contributes 70.69% and 67.62% respectively. The lowest ratio
Standard Chartered Bank indicates its low dependency in fund-ba
activity. The highest ratio of NABIL Bank indicates greater depende on fund-based activities. Figure 4.11 Interest Income to Total Income Ratio You're Reading a Preview
0.74
Unlock full access with a free trial.
0.72
Download With Free Trial
0.7 o i t 0.68 a R
0.66
Sign up to vote on this title
0.64
Useful
Not useful
0.62 2001/02
2002/03
2003/04
2004/05
2005/06
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
vi.
of 131
Non Performong Assets Project
Banking Statement
Search document
Interest from Loan, Advances and Overdraft to Total Inte Income Ratio
This ratio measures the contribution made by interest from loan, advan
and overdraft. Loan and advances generate the major portion of inte
income. Hence his ratio measures how efficiently the banks h employed their fund and loan and advances & overdraft. Table 4.12
Interest from Loan, Advances and Overdraft to Total Interest Inc Ratio Bank ank/F.Y. 2001/0 1/02 2002 002/023 023 200 2003/04 2004/05 2005 005/06 M NABIL
0.7151
0.7627
0.7604
0.7783
0.7545
0.7
SCBNL
0.5336
0.5627
0.5354
0.5494
0.5015
0.5
Table 4.12 shows that from the NABIL Banks point of view, the ratio
five years are 0.7151, 0.7627, 0.7604, 0.7783 & 0.7545 respectiv
Whereas the highest ratio in FY 2004/05 i.e. 0.7783 and the lowest r
in FY 2001/02 i.e. 0.7151. Similarly, the ratios of SCBNL are 0.53
0.5627, 0.5354, 0.5494 & 0.5015 respectively whereas wherea s the highest rati FY 2002/03 i.e. 0.5627 and lowest in 2005/06 i.e. 0.5015.
Sign up to vote has on this highest title From the mean point of view NABIL Bank ratio
Useful
Not useful
comparison with Standard Chartered Bank. It shows that NABIL Ban
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Figure 4.12
Interest from Loan, Advances and Overdraft to Total Interest Income Ratio 0.9 0.8 0.7 0.6 o 0.5 i t a R 0.4
0.3 0.2 0.1 0 2001/02
2002/03
2003/04
2004/05
2005/06
Fiscal Year
NABI NABIL L
vii.
SCBN SCBNL L
Interest Suspense to Interest Income from Loans & Advances Ra
Interest suspense means the interest due but not collected. This r
measures the composition of due but uncollected interest in the t
interest income from loans & advances. The high degree of this r Sign up to vote on this title
indicates the low interest turnover and low degree of this ratio indic
Useful
Not useful
high interest turnover. This ratio also helps to analyze the capacity of
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Table 4.13 shows that from the NABIL Banks point of view. The ratio
five years are 0.1840, 0.2324, 0.2171, 0.2182 & 0.1672 respecti
whereas the highest ratio in FY 2002/03 i.e. 0.2324 and the lowest rati
FY 2005/06 i.e. 0.1672 whereas, the ratio of SCBNL are 0.2655, 0.26
0.3001, 0.2625 & 0.2987 respectively. The highest ratio is in FY 2003 i.e. 0.3001 and lowest ratio in FY 2004/05 i.e. 0.2625.
From the mean point of view, Standard Chartered Bank has the hig ratio in comparison with NABIL Bank. If there is increasing trend of ratio, the volume of non-performing loans will increase resulting
interest turnover, which will ultimately lead to failure of the banks. F
the above analysis, NABIL Bank has the best performance than Stand Chartered Bank. Figure 4.13
Interest Suspense to Interest Income from Loans & Advances Ra 0.35
0.3
0.25
o i t a R
0.2
0.15
Sign up to vote on this title 0.1
0.05
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
4.2
of 131
Non Performong Assets Project
Banking Statement
Search document
Relationship of Loans and Net Profit
Effective loans directly affect net profit volume of the organization.
regarded as the most important profit indicator. It helps to increase the
profit volume of the company whereas weak level of loans is the signa lower level of profit. Thus, it is logical to review the relation of loans net profit.
For the research proposes, net profit and loans during study period
years) are averaged to get profit and loans variable. After getting p
and loans variable, then data are analyzed using person's correla
coefficient. The following table presents the correlation coefficient of profit and loans during study period. Table 4.14
You're Reading a Preview
Relation of Loans and Net Profit in NABIL: Correlation Matri Unlock full access with a free trial.
Loans
Net Profit
Loans
Net Profi
Pearson Correlation
1
0.907
N
5
5
0.907
1
5
5
Download With Free Trial
Pearson Correlation N
Sign up to vote on this title
The Table 4.14 presents the correlation coefficient between loans and
Useful
Not useful
profit during study period. The calculated Pearson's correla
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
management directly affects the net profit of the NABIL Bank. Effec loans management helps to increase and stable the net profit of NABIL Bank. No exception is found in case of NABIL Bank. Thus,
logical to review the impact of various components of working on profit. Table 4.15
Relation of Loans and Net Profit in SCBNL: Correlation Matri
Loans Net Profit
Loans
Net Profi
Pearson Correlation
1
0.876
N
5
5
0.876
1
5
5
Pearson Correlation N
The Table 4.15 presents the correlation coefficient between loans and
Reading profit during study You're period. Thea Preview calculated Pearson's correla
full access with a free trial. coefficient was found Unlock 0.876, which shows high degree of correlatio
indicates that loans andDownload net profit were With Freefound Trial highly correlated with e
other. That means, increasing loans helps to increase the net pr
Similarly, coefficient of determination was found to be 0.7674 wh
indicates that 76.74% of total change in profit has been determined
loans. Loans have high influence on net profit of the SCBNL. Effec loans management directly affects the
Sign up to vote on this title net profit of the SCBNL. Effec
Useful
Not useful
loans management helps to increase and stable the net profit of
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
weak level of non-performing loans is signal of the better performanc
the loans management. Thus, it is logical to review the valuation of n performing loans & loans management. Table 4.16
Relationship between Loans and Non-Performing Loan in NABI Correlation Matrix
Loans Loans
Pearson Correlation N Non Performing Loan Pearson Correlation N
1 5 -0.806 5
Non Perform Loan -0.806 5 1 5
The Table 4.16 presents the correlation coefficient between n
performing loan and loans during study period. The calculated Pears
Reading-0.806, a Previewwhich shows highly nega correlation coefficient You're was found
access with a free trial. correlation. It indicatesUnlock thatfullnon-performing loans and loans were hig
Withother. Free Trial negatively correlated Download with each That means, decreasing n
performing loan results increasing loans and vice versa in
management. Coefficient of determination was found 0.6496 wh
indicates that 64.96% of total change in loans management has b negatively determined by non-performing loans. Sign up to vote on this title
Useful Notby useful Loan management has been negatively influenced non-perform
loans. Effectively loans management helps to decrease the n
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
Table 4.17
Relationship between Loans and Non-Performing Loan in SCBN Correlation Matrix
Loans Loans
Non Perform Loan
Pearson Correlation
1
-0.931
N
5
5
-0.931
1
5
5
Non Performing Loan Pearson Correlation N
The Table 4.17 presents the correlation coefficient between n
performing loan and loans during study period. The calculated Pears
correlation coefficient was found -0.931, which shows high degree
Reading a Preview negative correlation. ItYou're indicates that non-performing loans and lo Unlock full access with a free trial.
were negatively correlated with each other. That means, decreasing n With Free Trial performance in loans Download management. Coefficient of determination
found 0.8668 which indicates that 86.68% of total change in lo
management has been negatively determined by non-performing loans
Loan management has been negatively influenced by non-perform
the n loans. Effectively loans management Sign helps toondecrease up to vote this title useful Useful performing loans. No exception is found in caseofNotSCBNL. Thus
logical to review the impact of various components of working in lo
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
the Banks is largely dependent by the loans management. Thus, it is m significance to know the impact of loans in net profit.
To find out the result the five years data (study period) of net profit, lo
are average to get a variable of net profit and loans. Therefore, sim
regression analysis is used for computation. The following table pres
the regression analysis of the independent variables loans on depend variables net profit of the NABIL Bank. Table 4.18 Impact of Loan and Advance on Net Profit in NABIL: Regression Analysis
Model
R
R Square
Adjusted R
Std. Erro
Square
the Estim
0.764
64950135
a Preview .907You're Reading 0.823
1
Unlock full access with a free trial.
a. Predictors: (Constant), Loans & Advances. Download With Free Trial
ANOVA Model 1
Sum of Squares
Df
Mean Square
F
Regression
58915082194952300.000
1
58915082194952300.000
13.966
Residual
12655560299106000.000
3
4218520099702002.000
Total
71570642494058300.000
4
a Predictors: (Constant), Loan & Advance b Dependent Variable: Net Prfoit
Sign up to vote on this title
Useful
Not useful
Table 4.18 shows that dependency of Net profit on loans. T
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Similarly, ANOVA table shows that the result presented above was
significant at 0.764 levels. The results of net profit volume and volum
loans resulted relatively higher level of 'F' statistics. The lower level o statistic resulted relatively higher level of significance. Although, it
significantly at overall evaluation, beta coefficient shows that the resu loans was not found significant. Table 4.19 Impact of Loan and Advance on Net Profit in SCBNL: Regression Analysis
Model
R
R Square
1
0.876
0.767
Adjusted R
Std. Erro
Square
the Estim
0.690
38192358
a. Predictors: (Constant), Loans & advances. You're Reading a Preview
Unlock full access with a free trial.
ANOVA
Download With FreedfTrial Sum of Squares
Model 1
Mean Square
F 9.890
Regression
14425882616188490.000
1
14425882616188490.000
Residual
4375968748247481.000
3
1458656249415827.000
Total
18801851364435970.000
4
a Predictors: (Constant), Loan & Advance b Dependent Variable: Net Prfoit
up to vote on this The title calculate Table 4.19 shows the dependency of Net Sign profit on loans.
Useful
Not useful
was found 0.876 indicates that there is high relationship with depend
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
Similarly, ANOVA table shows that the result presented above was
significant at 0.69 levels. The results of net profit volume and volum
loans resulted relatively higher level of 'F' statistics. The lower level o statistic resulted relatively higher level of significance. Although, it
significantly at overall evaluation, beta coefficient shows that the resu loans was not found significant. 4.5
Impact of Non-Performing Loan and Performance Loan Net Profit
Performing loan and non-performing loan have high implication
determining net profit. Effective performing loan and non-perform
loan directly affect the net profit of the organization. It means that the
profit of the organization is largely dependent by the performing loan
Reading a Preview non-performing loan ofYou're the organization. Thus, it is more significanc Unlock full access with a free trial. know the impact of performing loan and non-performing loan in
profit.
Download With Free Trial
To find out the result the five yes data (study period) of net pr
performing loan and non-performing loan are average to get a variabl
net profit, performing loan and non-performing loan respectiv Therefore, linear regression analysis is used for computation. Sign up to vote on this title
Useful Not following table presents the regression analysis ofuseful the indepen
variables performing loan and non-performing loans on depen
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Table 4.20
Impact of Non-Performing Loan and Performing Loan on Net Pr in NABIL: Regression Analysis
Model
R
R Square
1
0.929
0.862
Adjusted R
Std. Erro
Square
the Estim
0.725
35975573
a. Predictors: (Constant), Performing loan, Non-performing loan
ANOVA Model 1
Regression
Residual Total
Sum of Squares 16213367599958550.000
df 2
Mean Square 8106683799979270.000
2588483764477418.000
2
1294241882238709.000
18801851364435970.000
4
F 6.264
a Predictors: (Constant), Performing Loan, Non-Performing Loan b Dependent Variable: Net Prfoit
Reading of a Preview Table 4.20 shows that You're dependency Net profit on performing loan access with a free trial. found 0.929 indicates non-performing loan. Unlock The full calculated R was
there is high positiveDownload relationship dependent variable profit on With Free Trial
independent variables performing loans and non-performing loan. A
considering the error term, the adjusted R square value was found 0.7
which indicates that 72.5% of the total variation in the dependent varia
net profit has been explained by the two independent varia performing loans and non-performing
Sign up to vote on this title loans. Thus, it can be conclu
Useful
Not useful
that performing loan and non-performing loans is a strong determinan
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
statistic resulted relatively higher time of significance. Although, it
significantly at overall evaluation, beta coefficient shows that the resu
performing loans and non-performing loans was not found signifi individually. Table 4.21
Impact of Non-Performing Loan and Performing Loan on Net Pr in SCBNL : Regression Analysis
Model
R
R Square
1
0.932
0.869
Adjusted R
Std. Erro
Square
the Estim
0.739
35056041
a. Predictors: (Constant), Non-performing Loan, Performing Loan
ANOVA Model 1
Regression Residual Total
Sum of Squares
df
Mean Square
F
16343999249437960.000
2
8171999624718980.000
6.650
You're Reading a Preview
Unlock full access with a free 2457852114998011.000 2 trial. 1228926057499005.000
18801851364435970.000
4
Download With Free Trial
a Predictors: (Constant), Performing Loan, Non-Performing Loan b Dependent Variable: Net Prfoit
In the Table 4.21, the adjusted R square was found to be 0.
considering impendent variables performing loan, non-performing l
and dependent variable net profit. It means that 7.39% percent t Sign up to vote on this title
variation in dependent variable net profit been Useful has useful explained Not independent variables performing loan and non-performing loan. Thu
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
performing loans and volume of non-performing loan resulted relati
higher level of 'F' statistics resulted relatively higher time of significa
Although, it was significantly at overall evaluation, beta coeffic shows that the result of performing loans and non-performing loans not found significant individually. 4.6
Major Findings of the Study
The present section deals about some meaningful results on cr
management in selected commercial banks resulted from analysis of d
Primary objectives of the study were designed to assess the finan
conditions of the selected banks in terms of their creditability. Simila
it was also specified to compare the position of the banks. Second sources of information were used to meet the stated objectives of You're Reading a Preview study. Details of the findings are presented as below. s Unlock full access with a free trial.
1.
From the Stand Point of Credit Practice
•
The credit practices of NABIL in terms of total loans to dep
Download With Free Trial
ratio is found to be the highest more than SCBNL
0.6298>0.3660). It indicates the NABIL has been strong
mobilize its total deposit as loan. In terms of interest incom Sign up to vote on this title
loan and advances ratio NABIL has the highest mean score
Useful
Not useful
0.0932 and SCBNL has the mean scores of 0.0858
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
that if non-performing loan increases, the overall banking busi will be affected negatively. •
The ratio of loans and advances to total assets was found greate
NABIL in comparison with SCBNL which shows the good lend
performance of NABIL, whereas in terms of loan and advance
current assets ratio NABIL has highest mean than that of SCB
this means that NABIL has relatively better practice in short t lending. •
Lending policy of SCBNL in terms of loan loss provision to t
loans & advances was found relatively better than that of NA
Bank. The mean score of SCBNL was found lower than NA
Bank, i.e. 0.0293<0.0451. The result indicates that the low deg
You're a Preview of the ratio shows notReading only the strong and effective credit po Unlock full access with a free trial.
but also healthy performance of the economy. Download With Free Trial
The cursory looking for these selected banks in terms of credit pract reveals that all other ratios proves the SCBNL seems to have the lending performance. 2.
From the Stand Point of Credit Efficiency Sign up to vote on this title
•
Useful Not useful banks Efficiency measurement of selected in terms of total asse
liability was found better for NABIL and SCBNL. The mean sc
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
Standard Chartered Bank is successful to collect cheaper dep
than NABIL Bank. But the interest expenses to total expenses r
of Standard Chartered Bank has observed lowest than ratio
NABIL Bank (i.e. 0.2695<0.3017). This decreased ratio, here, mean that cost of deposit is also decreasing. •
The ratio of non-interest bearing deposits to total deposits is fo
highest i.e. 0.2642 in Standard Chartered Bank in compared w
NABIL Bank. From this analysis Standard Chartered Bank ca
viewed as the most successful in collecting cheapest fund in
form of current deposit that creates from the deposit accepta
from business enterprises. However, high current amount dep may adversely affect the bank at the time of adverse situation. •
You'reincome Reading to a Preview The result of interest total income ratio for NABIL B Unlock full access with a free trial.
is found higher than Standard Chartered Bank (i.e. 0.70
Download Withhigher Free Trial 0.6762). It indicates that the ratio of NABIL Bank show
high dependency on fund-based activities. The ratio of inte
from loan and advances to total interest income of NABIL Ban also found higher than Standard Chartered Bank, indicating NABIL Bank is strong to mobilize the loan and advances to Sign up to vote on this title
interest and also make more impact on total income.
•
Useful
Not useful
NABIL Bank has low degree of ratio of interest suspense
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
deposits, interest expenses to total expenses and non-interest bea
deposits to total deposits seems to be better for Standard Chartered B
whereas other ratios are more favourable to the NABIL Bank. It can
concluded that the efficiency of both NABIL Bank and Stand
Chartered Bank is found better. Furthermore, which ratio is bette measure credit efficiency dependents upon the banks own policies. 3.
From the Stand Point of Correlation Analysis
•
The correlation coefficient between loan and net profit of NA
Bank was found 0.508 it means moderate relationship betw
loan & net profit whereas SCBNL has 0.938 & it shows the h
relationship between loan & net profit. In the same way, coeffic
of determination of NABIL Bank and SCBNL are 25.81%
You're Reading Previewby total loan in NABIL B 87.96% of total change in neta profit
Unlock full access with a free trial. & SCBNL respectively. The profit is highly determined by loa
Download With Free Trial SCBNL in compared to NABIL Bank.
•
In the same way, correlation coefficient of loan and n
performing loan was found to be -0.862 & -0.275 in NABIL B
& SCBNL respectively. That means the trend of increasing volu
of loan decreases the non-performing loan atonhigh levelin NA Sign up to vote this title
Useful Similarly, Not usefulcoefficien Bank & SCBNL during study period.
determination was stood as 0.7430 and 0.0756 indicates
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
4.
From the Stand Point of Regression Analysis
•
The value of adjusted R square was found to be 0.011 & 0.01 NABIL & SCBNL considering impendent variable loan
dependent variable net profit. It was found that 1.11% total cha in dependent variable in net profit has been explained
independent variable loan in NABIL whereas 1.19% variation been explained by independent variable loan the findings
showed that both the result was not found significant at 0.01 lev of significance. •
The value of adjusted R square was found to be 0.033 & 0.088
NABIL & SCBNL respectively considering dependent variable profit and tow independent variables performing loan and You're Reading a Preview
performing loan.Unlock It indicates that 3.3% total change in depen full access with a free trial.
variable net profit has been explained by two independent varia Download With Free Trial
performing loan and non-performing loan in NABIL where
total change in dependent variable net profit has been explained
two independent variables performing loan and non-perform
loan in SCBNL. The finding showed that profit is highly estima by two impendent variables in SCBNL of NABIL. Sign up tothan vote onthat this title
useful Useful main reason behind this is the higher level of Not non-performing l
in SCBNL than that of NABIL.
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
CHAPTER – V SUMMARY, CONCLUSION AND RECOMMENDATIONS
Present study seems very successful to meet the stated object
designed for study. The present study has been designed to overcome
issues relating to credit management in commercial banks. It was aim
to find out comparative credit management in NABIL Bank and Stand Chartered Bank. The prime components of credit management is
financial condition in terms of lending practices, industrial environm
of that bank and the management quality in terms of credit managem
designed for study to meet the objectives. Present study successf
explored the financial condition in terms of credit management
You're Reading a Preview selected banks, industry environment of these banks and managem
Unlock full access with a free quality to support credit management. Ittrial. is clear evident that the b
having good financial position or Trial condition has good indus Download With Free environment and high quality of management. 5.1
Summary
Present study is very successful to meet the stated objectives designed the study. The researcher highlights
Sign up to vote on this title or introduces the meaning
Useful
Not useful
importance of research paper and meets the objectives followed
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
the study and introduction of the study. Lastly, it discusses about organizational structure of the study.
The second chapter helped the researcher to provide knowledge about development and progress made by the earlier researcher on
concerned field or topic of the study. It helped to know the research w undertaken by them. It also tried to know some concept used in
study. Moreover, it summarized the finding of the previous finding
the study to provide knowledge about the background of the work d by them and to step the duplicate of previous work. Lastly,
international research related to concept is also attempted to review finding of the study.
The third chapter of the study discussed about various resea
ReadingBasically, a Preview research methodology h methodologies used forYou're the study.
Unlock full access with a free trial. signifies the research design, sources of data, population and sampl
data, data collection procedure, collection Download data With Free Trial techniques, data collec methods and tools and techniques employed etc.
The fourth chapter of the study dealt about data presentation and analy
It first presented the generated data in tabular form and analyzed i
systematically as per the objectives mentioned above. The researc Sign up to vote on this title
Useful or Notposition useful condition tried to analyze the comparative financial of ban
terms of credit practices, credit efficiencies, comparative indus
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
in overall evaluation the results shows that the lending practice of SCBNL was found relatively better position than NABIL Banks.
The overall evaluation of selected banks on the basis of credit efficie
measurements provides the controversial results towards the NA
Bank and Standard Chartered Bank. The ratio of interest expenses to t
deposits, interest expenses to total expenses and non-interest bea
deposits to total deposits seems to be better for Standard Chartered B
whereas total assets to liability, interest income to total income, inte
from loan and advances to total income and interest suspense to t
interest income from loan and advances ratios are more favourable to
NABIL Bank. It can be concluded that the efficiency of both NABIL
SCBNL was found better. However, credit efficiency measurem variables adopted by the banks may differ from bank to bank. You're Reading a Preview
The correlation coefficient between loan and net profit of NABIL B Unlock full access with a free trial.
was found 0.508 indicates that the moderate relationship between loa Download With Free Trial
net profit whereas SCBNL has 0.938 & it shows the high relation
between loan & net profit. In the same way, coefficient of determina
of NABIL Bank and SCBNL of total change in net profit has b
explained by total loan as 25.81% & 87.98% respectively. The prof
highly determined by loan in SCBNL in compared to NABIL Bank Sign up to vote on this title
the same way, correlation coefficient of non-performing Useful and useful loan Not
was found to be and -0.862 & -0.275 in NABIL & SCBNL respectiv
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
The value of adjusted R square was found to be 0.011 & 0.019 in NAB & SCBNL considering independent variable loan and dependent varia net profit. It was found that 1.11% total change in dependent variable i net profit has been explained by independent variable loan in NABIL whereas 1.19% variation has been explained by independent variable loan. The findings also showed that both the result was not found significant at 0.01 levels of significance. The value of adjusted R squa was found to be 0.033 & 0.0887 in NABIL & SCBNL respectively considering dependent variable net profit and two independent variabl performing loan and non-performing loan. It indicates that 3.3% total change in dependent variable net profit has been explained by two independent variables performing loan and non-performing loan in NABIL whereas 8.87% total change in dependent variable net profit h been explained by two independent variables performing loan and non performing loan in SCBNL. The finding showed that profit is highly estimated by two independent variables in SCBNL than that of NABIL The main reason behind this is the higher level of non-performing loan SCBNL than that of NABIL.
Finally, conclusion and summary and various suggestions were descr You're Reading a Preview
in fifth chapter. It drew the conclusion from the findings of the study Unlock full access with a free trial.
explained the summary of the research paper. Besides, it also prov Download With Free Trial
various suggestions to give further improvement. 5.2
Conclusion
The present study successfully explored the result to meet the st
objectives of the study and found meaningful. The result showed th Sign up to vote on this title
Useful better Not useful credit practice of SCBNL was found relatively in compariso
NABIL Bank because the most of the ratio of credit practices scored
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
non-performing loan was found high negative degree in NABIL (i
0.862) and low negative degree in SCBNL (i.e. -0.275). The impac loan and advances to net profit and impact of non performing loan
performing loan to net profit was found higher in NABIL and SCB during the study period. 5.3
Recommendations
The present study can be a valuable piece of research works in cr
management topic. It explored the existing situation and identified
various components for further improvement in credit managem
Secondary sources of information are used for fulfilling the objective
may be useful for academicians, parishioners, especially to b
management and/or any others who are directly or indirectly involve
banking activities. Based on the findings of the study, the resear
recommended highlighting the guidelines to put forward for fur improvement. 1.
The credit practice of SCBNL was found relatively better
NABIL Bank during the study period. It is suggested to NA
Banks management for better improvement. Similarly, inte
income from loan and advances was found greater in NABIL Ba Sign up to vote on this title
useful Useful Not The main source of income is based on loan and advances. T
proper level of portfolio should be maintained so that profitab
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
as successful to manage loan and advance. Thus, it is suggeste maintain proper level of balance for both banks. 3.
The relationship between loan and advances to non-perform
loan was found negative in NABIL and SCBNL. But the NA has high negative figure of 0.862. It indicates that NABIL
SCBNL have effectively managed its loan and advances. Thi also supported by regression analysis because impact of loan
advances to net profit was found positive in NABIL & SCB
The impact of performing loan and non-performing loan on
profit was found positive values for all selected banks. But
regression value for SCBNL is observed high as compared NABIL Bank. Thus, SCBNL needs to be managed its effectively so as to reduce the non-performing loan amount. 4.
The NABIL Bank and Standard Chartered Bank are concentra
their operation in urban areas. Most of the people who live in r
areas are not benefited form these two most successful and g
commercial banks. Thus, they should think about expanding t
operation to rural areas too. This will provide financial suppor rural households and raise their standard of living. Sign up to vote on this title
5.
useful Useful inNot Although there is major political instability the recent econo
scenario of the country, the government has to encourage
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Upload
Sign In
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
of 131
Non Performong Assets Project
Banking Statement
Search document
performance, customers' satisfaction, stakeholders support, governm
rating, supervisor's teamwork, human resource development, hu resource planning, human resource management, job designation etc. An nex - 1 Loan & advances advances to total assets ratio NABIL F/Y
Loan & advances
Total Ass ets
Ratios
2001/02
7437894676
17629252392
0.42190641
2002/03
7755951985
16562624992
0.46828035
2003/04
8189992851
16745486638
0.48908658
2004/05
10586170002
17186330816
0.61596451
2005/06
12922543153
22329971078
0.57870845
SCBNL F/Y
Loan & advances
Total Ass ets
Ratios
2001/02
5364005108
18443105071
0.29084067
2002/03
5695823521
21000503444
0.27122318
2003/04
6410242081
23642059790
0.27113720
2004/05
8143207783
21893578211
0.37194503
2005/06
8935417810
25776332320
0.34665202
Total assets assets to liabilities ratio NABIL F/Y
Total Ass ets
Liabil iti es
Ratios
2001/02
17629252392
16482824098
1.069552905
2002/03
16562624992
2003/04
16745486638
15248437536 1.086185057 Sign up to vote on this title1.097071626 15263804335
2004/05
17186330816
Useful Not useful 1.106746805 15528692508
2005/06
22329971078
20454976661
1.091664461
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
2005/06
of 131
25776332320
Non Performong Assets Project
Banking Statement
Search document
24022193543
1.07302159
You're Reading a Preview Unlock full access with a free trial.
Download With Free Trial
Sign up to vote on this title
Useful
Not useful
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
of 131
Non Performong Assets Project
Banking Statement
Search document
Loan & advances to current assets ratio NABIL F/Y
Loan & advances
Cuurent Ass ets
Ratios
2001/02
7437894676
1083187849
6.86667107
2002/03
7755951985
1814971780
4.27331822
2003/04
8189992851
1889219943
4.33511877
2004/05
10586170002
1427808921
7.41427641
2005/06
12922543153
2365140531
5.46375278
SCBNL F/Y
Loan & advances
Cuurent Ass ets
Ratios
2001/02
5364005108
2887228863
1.85783855
2002/03
5695823521
3170214786
1.7966680
2003/04
6410242081
4241763149
1.51122112
2004/05
8143207783
3370807894
2.41580298
2005/06
8935417810
2578742423
3.46502920
You're Reading a Preview Loan loss provi sion to total loan & advances ratio Unlock full access with a free trial.
NABIL
F/Y
Loan loss provision TotalTrial loan & advances Download With Free
Ratios
2001/02
363953887
7437894676
0.048932
2002/03
357732236
7755951985
0.0461235
2003/04
358664187
8189992851
0.0437929
2004/05
360566575
10586170002
0.0340601
2005/06
356239106
12922543153
0.027567
Sign up to vote on this title SCBNL Useful F/Y 2001/02
Not useful
Loan loss provisi on
Loan & advances
332176578
5364005108
Ratios
0.0619269
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
of 131
Non Performong Assets Project
Banking Statement
Search document
Interest expenses to total expenses ratio NABIL F/Y
Interest expenses
Total expenses
Ratios
2001/02
462078587
1367476674
0.3379060
2002/03
317348258
1011214513
0.31382882
2003/04
282947633
971123979
0.29136097
2004/05
243544611
992048481
0.24549668
2005/06
357161304
1115771051
0.3201026
SCBNL F/Y
Interest expenses
Total expenses
Ratios
2001/02
299859805
967608264
0.30989793
2002/03
255153942
996670229
0.25600638
2003/04
275809176
1046207844
0.26362751
2004/05
254126645
1037070545
0.24504277
2005/06
303198419
1111099128
0.2728815
You're Reading a Preview Non-interest bearing deposit to tot al deposit ratio Unlock full access with a free trial.
NABIL
F/Y
Non-interestDownload bearing deposi t With Free Trial Total deposit s
Ratios
2001/02
3142565445
15506428215
0.2026621
2002/03
3424691968
13447661064
0.2546682
2003/04
3012933088
14119032115
0.2133951
2004/05
3140410593
14586608707
0.2152940
2005/06
3276385918
19347399440
0.1693450
Sign up to vote on this title SCBNL Useful F/Y 2001/02
Not useful
Non-interest bearing deposi t
Total deposit s
4027948409
15835747479
Ratios
0.2543579
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
of 131
Non Performong Assets Project
Banking Statement
Search document
Interest income to total income ratio NABIL F/Y
Interest inc ome
Total inco me
Ratios
2001/02
1120184120
1638888395
0.683502381
2002/03
1017872280
1427900605
0.712845331
2003/04
1001616901
1426330907
0.702233189
2004/05
1068746769
1510448268
0.707569264
2005/06
1309998500
1799065587
0.728154943
Interest inc ome
Total inco me
Ratios
2001/02
1013635699
1446419163
0.700789733
2002/03
1001359505
1504023499
0.665787141
2003/04
1042175628
1583816937
0.658015206
2004/05
1058677576
1540790237
0.687100392
2005/06
1189602957
1777252991
0.66934925
SCBNL F/Y
You're Reading a Preview Interest fro m loan, advances & overdraft to total interest income ratio Unlock full access with a free trial.
NABIL
F/Y
Interest from loan,Download advancesWith & overdraft Free TrialTotal interest income
Ra
2001/02
801046033
1120184120
0.71510
2002/03
776300988
1017872280
0.7626
2003/04
761616605
1001616901
0.76038
2004/05
831829635
1068746769
0.77832
2005/06
988413451
1309998500
0.75451
Sign up to vote on this title SCBNL Useful
Not useful
F/Y
Interest from loan, advances & overdraft
Total interest income
2001/02
540851328
1013635699
Ra
0.53357
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
1
Download
News
Documents
Sheet Music
Half Yearly Communication
of 131
Non Performong Assets Project
Banking Statement
Search document
Interest s uspense to total interest incom e from loan & advances ratio NABIL F/Y
Interest susp ense
Total Interest from loan & advances
Ratio
2001/02
100682364
547072580
0.18403
2002/03
125452355
539749165
0.23242
2003/04
112447523
517962940
0.21709
2004/05
122307801
560469027
0.21822
2005/06
109673450
655993120
0.16718
SCBNL F/Y
Interest susp ense
Total Interest fro m loan & advances
Ratio
2001/02
105214857
396223213
0.265544
2002/03
121643526
461953877
0.263323
2003/04
146566546
488378563
0.300108
2004/05
133460066
508389523
0.262515
2005/06
160694438
537977424
0.298701
You're Reading a Preview Unlock full access with a free trial.
Exchange gain to total incom e
NABIL Download With Free Trial Exchange gain
Total inco me
%
2001/02
154219398
1638888395
0.0941
2002/03
144075171
1427900605
0.1009
2003/04
157324299
1426330907
0.1103
2004/05
184878868
1510448268
0.1224
2005/06
185483662
1799065587
0.1031
F/Y
Sign up to vote on this title
Useful
Not useful
SCBNL F/Y
Exchange gain
Total inco me
%
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Half Yearly Communication
1
Download
News
Documents
Sheet Music
of 131
Non Performong Assets Project
Banking Statement
Search document
Calculation f or correlation coeffic ient between loans and net profit NABIL F/Y
Loans (X)
Net prof it (Y)
2001/02
417289060
271638612
2002/03
961461153
416235811
2003/04
229660000
455311222
2004/05
17062680
518635749
2005/06
173201710
635262349
SCBNL F/Y
Loans (X)
Net pro fit (Y)
2001/02
684723533
479206569
2002/03
79163484
506932087
2003/04
78282731
537800124
2004/05
55926267
539203887
2005/06
658755881
You're Reading a Preview
Calculation f or cor relation coefficient between loans and non-performing loan Unlock full access with a free trial.
NABIL
F/Y
Loans (X)Download With Non-performi Free Trial ng loan (Y)
NPA
2001/02
417289060
271638612
0.071
2002/03
961461153
416235811
0.055
2003/04
229660000
455311222
0.033
2004/05
17062680
518635749
0.013
2005/06
173201710
635262349
0.013
Sign up to vote on this title SCBNL Useful
Not useful
F/Y
Loans (X)
Non-performi ng loan (Y)
NPA
2001/02
684723533
479206569
0.048
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
A
BIBLIOGRAPHY BOOKS
Aliber, R.Z. (1973), The International Money Game. New York: B Book Inc.
Beckman, N. Theodore. (1962), Credit and Collections. New Jer Prentice Hall Inc.
Bexley, J. (1987), Banking Management. Delhi: Surjeet Publications
Bhattacharya, H. (1998), Banking Strategy, Credit Appraisal Lending Decisions-A Risk Return Framework. New De Oxford University Press.
Chaplin, A. and George Ehasset. (1963), Credit and collection princ and Practices. New York: Mac Graw Hill Book Inc. You're Reading a Preview Clemen, J.H. (1963), Banking Lending. Publishers. Unlock full access with a free trial.
London:
Butterw
Crosse, H.D. (1963), Download Management Policies for Commercial Ban With Free Trial New Jersey: Prentice Hall Inc.
Dahal, S. and Bhuvan. (1999), A Handbook of Banking. Kathman Asmita Books and Stationery.
Gitman, L.J., and Jochnk. (1972), Fundamental of Investing. New Y Harper and Row Publishers. Sign up to vote on this title
useful Johnson & Johnson. (1940), Commercial UsefulBank NotManagement Dryden Press New York.
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
Download
News
Documents
Sheet Music
Half Yearly Communication
1
of 131
Non Performong Assets Project
Banking Statement
Search document
Pandey, I.M. (1999), Finanacial Management. New Delhi: V Publishing House
Radhaswamy, M., and S.V. Vasudevan. (1979), A Text Book Banking. New Delhi: S. Chand and Co. Ltd.
Reed, W. Edward., Richard V. Cotter, Edward K. Gill and Richard Smith. (1980), Commercial Banking. New Jersey: Prentice H Inc. Shekhar, K.C. and Lekshmy Shekhar. (1999), Banking Theory Practice. New Delhi: Vikas Publishing House Ltd.
Singh, S.P. and S.Singh. (1983), Financial Analysis for Cr Management in Banks. New Delhi: Vikas Publishing House L
Srinivasa, H.V. (1986), Banker’s Handbook of Credit Managem Raja Garden, New Delhi: Criterion Publications.
Vaidya, S. (1999), Banking Management. Kathmandu: Monitor Nep
Wolf, H. and Prem R. Pant. Science Research and Th You're(2002), Reading aSocial Preview Writing. Kathmandu: Buddha Academic Publishers Unlock full access with a free trial. Distributors Pvt. Ltd. Download With Free Trial
Journals, Reports and Articles
Adhikari, B.D. (2004), Some of the Characteristics of Umbr Ordinance. Mirmire, pp. 148 – 149. Annual Reports of NABIL 2001/02 – 2005/06 Sign up to vote on this title
Useful
Annual Reports of SCBNL 2001/02 – 2005/06
Not useful
Banking And Financial Statistics. Mid-Jan 2006. Nepal Rastra B
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
Search
Home
Saved
1
29 views
Sign In
Upload
Join
RELATED TITLES
0
Cr. mgnt of CBasa Uploaded by Niraj Sarawagi
Books
Audiobooks
Magazines
asa
Save
Embed
Share
Print
News
Documents
Sheet Music
Half Yearly Communication
1
Download
of 131
Non Performong Assets Project
Banking Statement
Search document
Khatri, S. (2004), One Umbrella Act’s Pros and Cons . New Busi Age, pp. 18-19.
Poudyal, R. (2003), Facts of Banks Credit in Nepalese Money Mar Economic Collection(NRB).
Pradhan, M. (2004), The Importance of Loan Information Center A Its Activities. NRB Samachar Anuual Publication, pp. 118-123. Sapkota, Suman (2001), Doubtful Debtors Provisions. Nepal Bank Patrika, pp. 47-50.
and
New
Chan
Thapa, Dr. B. (2004), Umbrella Act in Banking Sector . Drishti Wee pp. 4-5.
Thesis
Adhikiari, M. (2004), Credit Management of Commercial Ba in the context of Financial Sector Reform Program You're Reading a Preview unpublished Master’s Thesis, Nepal Commerce Campus, T Kathmandu. Unlock full access with a free trial.
Bhatta, K. (2003), Download A Comparative With Free Trial Study on Lending a Investment Policy of Himalayan Bank Ltd. and Ot Joint-venture Banks. An unpublished Master’s Thesis, Ne Commerce Campus, T.U., Kathmandu. Bhattarai, R. (1978), Lending Policy of Commercial Banks unpublished Master’s Thesis, T.U., Kathmandu. Sign up to vote on this title
Dhungana, P. (2002), A comparative study on Investment Policy Useful Not useful NBBL and Other Joint-venture Banks. An unpublished Mast Thesis, T.U.
Home
Saved
Books
Audiobooks
Magazines
News
Documents
Sheet Music
Upload
Sign In
Join
