Economy

RED ALERT: 56 billion of Nepali bank’s international investment in peril

Published by Octron on November 19, 2008

Amid the global financial crisis, the international investments of most of the commercial banks have fallen in dangerous zone. According to Nepal Rastra Bank, 12 out of 25 commercial banks in Nepal have dumped their heavy bucks in the foreign land. Either it may be in the form of deposits, bonds or shares around 55.98 billion of the finances of the local banks are in the hands of European, American, Singaporean and Indian companies.

To talk about the rules, Nepalese financial institutions are prohibited to cast off their investments in the transnational company’s financial instruments. But rules are to break and violating the so called rules, banks back home have invested millions of doughs overseas.

Lists of companies with their respective international investments are presented in the table given below:

Banks – Investments (in 100 thousand)

Nepal Bank Ltd – 25997
Rastriya Banijya Bank – 618555
Nabil Bank Ltd. – 25585
Nepal Investment Bank Ltd. – 73454
Standard Chartered Bank Ltd. – 46412
Nepal SBI Bank Ltd. – 1050
Nepal Bangladesh Bank Ltd. – 2525
Nepal Credit & Commercial Bank Ltd. – 864
Lumbini Bank Ltd. – 9583
Nepal Industrial & Commercial Bank Ltd. – 6778
Agriculture Development Bank Ltd – 5796
NMB Bank Ltd. – 279901

As per the figure above, NMB Bank Ltd. has invested around 50% of its total investments in international securities. However, Nepal Credit & Commercial Bank Ltd. has 86 million international investments which is only 0.15% of its total investment.

In the situation when the worlds largest economies are in tailspin and the global economic slowdown are blowing rapidly on the face of the Asian market the safety of international investments has grown up as a major issue.

Source: Naya Patrika (18th Nov 2008)

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