Commercial banks raise home loans rate

More than half a dozen commercial banks have hiked home loan rates by as much as 1.5 percentage points - a move which will disappoint borrowers deeply, citing increase in cost of capital. Banks like NMB Bank, Global Bank, Nepal Industrial and Commercial (NIC) Bank and KIST Bank have enforced the new rates from the new fiscal year, starting from Sunday this week. Following the change, NIC Bank´s home loans rate has jumped to as high as 16.49 percent. Similarly, rate of NMB Bank also stands at over 16 percent, while that of KIST Bank has gone up to the range of 14 to 16 percent.

The fresh hike has also jacked up the industry average rate of home loans to just over 16 percent. So far, the industry average rate was over 15 percent. "We had to raise the rates mainly because the central bank´s directives sought us to close the interest rate gap between different savings schemes to 2 percent or less. This raised our cost of capital," said Upendra Paudel, chief executive of NMB Bank. The central bank has asked the banks and financial institutions to bridge the gap in rate between different savings products, mainly as bankers, while luring fresh deposits, offered higher rates to new depositors only, leaving old accounts holders deprived of due interest return.

Banks were offering as high as 10 percent interest return to new depositors, whereas older depositors were offered as low as 3 percent. "This is not fair. The banks must bridge the gap to 2 percent or less," NRB had said in its directives. Though a few banks had instantly complied with the directives, most of the BFIs are just gearing up to implement it. As a result, sources told Republica that more banks may follow the suit and raise lending rates because they are ´left with no choice´ as they have raised the rate of minimal interest rate to bridge the gap.

"As liquidity problem has not faded away in a large number of banks, they cannot lower the higher rates. And the unwanted raise of lower savings rate has gone up to increase cost of capital," said the source. Interestingly, the latest hike in lending rate has come contrary to what Nepal Bankers´ Association (NBA) had announced about a month ago. With the ease in liquidity in leading banks, NBA had said they have lowered the interest return to corporate clients by as much as a percentage point. "We believe this will eventually lead to drop in lending rates," NBA president Ashok Rana had told Republica then.

Source:
myrepublica

NIC Bank & Brihat Investment to promote home loan products

NIC Bank and Brihat Investment entered into and agreement today to promote home loan products. "The trained agents from Real Estate Marketing Agents (REMA) from Brihat Investment will be working as direct selling agents for the NIC Bank to sell home loan products," said Purnima Rajbhandari, CEO of Brihat Investment that has been advocating and lobbying with the banks, the government and Nepal Land and Housing Developers' Association (NLHDA) to establish REMA profession.

Brihat Investment has trained the REMA professionals for ethical buying and selling of houses, she said, adding that they have the expertise to asses and the ascertain quality of an asset and help buyers find good value for their investments. Under the agreement, REMA will facilitate the prospective buyers for acquiring home loan from NIC Bank for purchase of residential houses/apartments.

NIC Bank has demonstrated its leadership in the home loan league through its popular product NIC Ghar Subidha for its comprehensive product bundling. "The Bank believes that the arrangement with Brihat Investment-REMA, our customers will have better access to our services and quick turn around time in availing home loans," said the bank. The licensed agents for the real estate sector will help boost the sector as they can bring professionalism in the sector that has been facing slowdown recently, Rajbhandari said, adding that the NIC Bank and REMA both can work jointly to facilitate the home buyers.

Currently, the real estate and housing sector has around Rs 200 billion investment and the central bank has also been seriously working on to help the sector that creates employment. Though, the land plotting and land transaction has been discouraged, the central bank has also accepted contribution of the real estate and housing sector to gross domestic product (GDP). Meanwhile, the central bank governor has also urged the developers to build houses that are under common people's purchasing capacity. "The housing products should be within the purchasing capacity of the people," he said in an interaction recently.

Source:
tht

New NIC Bank branches

NIC Bank opened four new branches at New Baneshwor, Thankot, Thamel and Maharajgunj in Kathmandu on Tuesday, taking the number of branches to 32. The bank has 28 ATMs in the country. The new branches will provide a full range of products and services including loans, deposits, card payments, Internet and mobile banking. The bank recently distributed cash dividend at the rate of 26.32 per cent, the highest dividend, among banks for 2009-10, the bank claimed.

Source:
tht

New NIC branch at Gaur in Rautahat

NIC Bank opened its 28th branch at Gaur in the Rautahat district. The branch will provide all the modern banking facilities including Internet banking. The bank also announced a cash dividend of 26.32 per cent for the year 2009-10, subject to approval of Nepal Rastra Bank (NRB) and the bank's Annual General Meeting. The bank posted a net profit of Rs 450 million for the year and a growth of 42 per cent, compared to the previous year. The bank has a customer base of over 100,000 and has installed 25 ATMs in the country.

Source:
tht

NIC banks lending to industries more

Some eight commercial banks have applied for the refinancing facility from the central bank. Out of the eight commercial banks ¿ Citizens Bank International, DCBL, Kumari Bank, NIC Bank, Global Bank, Prime Commercial Bank, NCC Bank, Kist Bank, Laxmi Bank ¿ Citizens Bank International has already received Rs 430 million. Similarly, the NIC Bank ¿ that has consistently focused on channeling its credit to productive sectors contributing to the country's economic growth ¿ has also applied for Rs 440 million refinancing facility. As of mid-April, it has floated 90 per cent of it's total loan portfolio of about Rs 14 billion in over 2,000 diversified industries and businesses, said the bank. NIC has floated loans in a wide range of industries including food processing, steel, cloth, yarn, cement, paints, jute, carpets, paper, handicrafts, hotels, hospitals, education, agriculture, leather, plastics, cables, bricks, and IT. "It has only around 10 per cent exposure in real estate portfolio," it claimed. The bank ¿ that has a large network of 25 branches spread from Jhapa in the east to Mahendra Nagar in the far west ¿ has announced a 27 per cent growth in net profit to Rs 319 million in the first nine months of the current fiscal year compared with the same period last year. The mid-term evaluation of the Monetary Policy has introduced refinancing facility to pump in liquidity in the banking system for productive sectors like tourism, hydropower, exports, agriculture, small and medium scale industry and other productive sectors.

Source: tht

NICB in Malangawa

01, Jan 2010

NIC Bank Limited has opened a new branch in Malangawa of Sarlahi district on Thursday. It will provide a full range of products and services including all modern day banking facilities like trade finance, remittance, business banking, ATM debit cards, drafts, SMS banking and traveller cheques. The bank recently announced 15 per cent bonus shares and 0.79 per cent cash dividend for the year 2008-09.

Source:
THT

Financial Stocks Leads Nepse up (+3.16 Points)

Key financial scrip rushed to positive finish on Tuesday set off optimistic close on Nepal stock exchange after plunging hefty on previous session. The home equity market edge up 3.16 points or 0.56 percent to 564.98 after previous session's plunge of 5.12 points. 

In recent days, the sole secondary market is experiencing series of ups and down. It forward one steps up but eventually traded two steps down on frail investment outlook. Investors are on dubious situation what to do next and are too confused on predicting the stock market health. There are rumors around the city that market will collapse further more hence asking regularities bodies to act decisively in favor of stock market.

However today the market has ticked to higher end discounting all the negative rumors. But market analyst viewed that, even stocks have surged today it has indeed failed to uplift the market sentiment in upper perimeter. Investors are viewing carefully the each and every happening on political environment of nation which will basically craft the path of stock market in near term.

Commercial bank which accounts the large volume of trade ended adding 3.95 points or 0.73 percent to 541.46. Standard Chartered (Rs. 3600, +Rs. 40), Nabil Bank (Rs. 2655, +Rs. 5), Nepal Investment (Rs. 850, +Rs. 28), NIC Bank (Rs. 755, +Rs. 21) along with other key commercial bank heave up today to support the surge in Nepse index. Likewise, surge in scrip price of Sanima Bikash Bank (Rs. 577, +9.9%) and Vibor Bikash Bank (Rs. 392, +5.66%) led the development bank index to close at 5.96 points or (+0.97%) higher.

The BOD meeting of Sanima Bikash Bank scheduled on 16th November 2009 (2066 Mangsir 1) has decided to propose 1:1.5 right shares and previously than bank has decided to give 5% bonus shares from the profit of fiscal year 2008/09.

Finance sub-index was up 0.57 points to 599.76, others sub-index gained 2.35 points or 0.39 points, however hydro sub-index plummets marginal of 0.27 points while insurance lost hefty of 9.32 points or 1.55 percent.

Sensitive index gained parallel to Nepse index with a surge of 1.09 points or 0.78 percent to 141.50. Similarly, float Index an indicator of performance of ordinary shares in the market was up 0.25 points to 53.81.

Merely 60 companies registered their presence in the secondary market with 23 gainers and 26 losers. The A-D ratio was maintained at .88. All in all 207912 shares traded today via 857 transactions. Moreover, Rs. 72723685 turnover was realized along with Rs.413420.31 million market capitalizations. Yesterday, 100476 units share traded via 1042 transaction amounting to Rs. 56879894 turnover along with Rs.411106.27 million market capitalizations.

The top five standouts of the day are GFL(9.92%), SBBL( 9.9%), NUBL( 6.79%), VBBL( 5.66%), DCBL(5%). Whereas, DCBLPO(-5.77%), RMBFI(-5.71%), NLIC( -3.9%), GBL( -3.11%), BDBL( -2.49%). comprised of the top five losers.

Market down over investors' worry

The Nepse index (-3.82%) witnessed yet another week of depression as IPOs lured investors toward the primary market. The increase in the inter-banking lending rate has also discouraged investors from borrowing. In addition, the Maoist party´s disclosure of its nation-wide protest plans further deflated investor confidence. Signs of stability, the market exhibited last week did not last with the announcements of bonus and cash dividend from some of the major companies. 

The Commercial Banking sub-index (-5.91%) descended as major banks like Everest Bank (-Rs 320) which is experiencing post-book closure price readjustment, NIC Bank (-Rs 101) which declared 15% bonus shares, Siddhartha Bank (-Rs 88) which declared 10% cash dividend, Siddhartha Development Bank (-Rs 5) which declared 5% cash dividend, all shed prices. Losses of API Finance (-Rs 55) which started trading last week, and the post-book closure readjustment in the share price of Nepal Express Finance (-Rs70) caused losses in the Finance sub-index (-1.63%) despite Merchant Finance (+Rs 103) and General Finance (+Rs 20) efforts to recoup the losses. Swawalamban Vikas Bank´s (+Rs 28) share prices appreciated but with losses in the majority of the development banks, the sector index (-1.55%) declined. Shikhar Insurance (-Rs 6) and Lumbini General Insurance (-Rs 8) posted declines to drag the Insurance sector down (-0.49%). The ´Others´ sub-index (-0.92%) plunged as Nepal Telecom (-Rs 10) shed value. The only sector to defy the market downtrend was the Hydropower sector sub-index (+0.98%) through the appreciation of Chilime Hydropower (+Rs 32).

Among other highlights, Bank of Kathmandu (-Rs 35) declared lucrative benefits of 40% bonus shares and 7.37% cash dividend. Kumari Bank (-Rs 59) and Kist Bank (-Rs 27) closed their books for 10% bonus shares, and 3.50% cash dividend respectively on October 30 which will impact the market next week. Shree Investment Finance also closed its book for 20% bonus shares and 5.26% cash dividend on October 23. Asian Life Insurance´s IPO offering was halted on 30 October because its offer price violates the Company Act. Civil Merchant Bittiya Sanstha (+Rs 6), United Insurance, Sagarmatha Merchant and Finance (-Rs 3) are selling 730 units, 25,575 units and 40,790 units respectively of their unsubscribed right shares. The market volume (Rs 276,356,647) has strengthened; however, the current downtrend is substantiated by signals from technical analysis tools.

 REPUBLICA 

Weak Sentiment Pulls Nepse Down

Stocks at home bourse were solidly lower with blue chips share soften on shabby investors confidence. The benchmark Nepse logged its seventh session straight drop on Thursday to close at 579.58, losing 5.46 points or 0.93 percent. Sell-off marked the investors' sentiment that led secondary market to settle worst for more than 28 months.

Scrip price of companies which has recently declared dividends, as Bank of Kathmandu (40% stock dividend), NIC Bank (15% stock dividend) experienced fall of Rs. 45 and Rs. 61 respectively. This tendency shows that, at temporary phase the market is not running on fundamentals or technical strength but with the investors' sentiment which is absolutely feeble.

Fresh share at market in form of right share and bonus shares has increased the supply side in one hand, on the next IPOs in the market has shifted the investment to risk free and high return rather than plain sailing secondary market. Likewise, political discrepancies along with protest declaration by opposition party U-CPNL (moist) has definitely created an additional leg down in the market.

Selling spree has dragged down the scrip prices of most of the financial stocks that smashed the financial stocks loaded Sensitive index to plunged 1.93 points or 1.31 percent to 145.13. Blue chip scrip at Nepse consists 14 commercial banks, 37 finance companies, 15 development bank, 10 insurance companies and one each from hydropower and manufacturing companies. Likewise, float Index an indicator of performance of ordinary shares in the market was down 0.80 points to 55.26.

Commercial bank shed hefty of 9.02 points or 1.60 percent to 554.61, development bank lost 1.12 points or 0.17 percent to 646.68 while finance slipped 2.80 points to 614.51. Likewise, hydro plummets 3.38 points; however insurance heaved up slightly 0.23 points along with 5.88 points rise in others sectors. Among commercial scrip, NIC Bank (Rs. 754, -7.48%) fronted with the heavy decline along with slump in key banks as Standard Chartered (Rs. 3583, -Rs. 16), Nabil Bank (Rs. 2700, -Rs. 70), Bank of Kathmandu (Rs. 1515, -Rs. 45), Everest Bank (Rs. 1700, -Rs. 89) and so on. Likewise, execution of trade after book closure of Nepal Share markets Limited's Promoter share (Rs. 194, -71.17%), Merchant Finance (Rs. 431, -9.31%) dragged down finance sub index.

Merely 60 companies registered their presence in the secondary market with 13 gainers and 41 losers. The A-D ratio was maintained at 0.32. All in all 152527 shares traded today via 869 transactions. Moreover, Rs. 75312033 turnover was realized along with Rs.407538.89 million market capitalizations. Yesterday, 54727 units' shares traded via 738 transactions amounting Rs. 30385763 turnover along with Rs.412370.06 million market capitalizations. Today's increase in turnover along with down stock index shows that investors stampede to sell shares is at utmost ceiling.

The top five standouts of the day are GFL(4.26%), SBBL( 2.8%), RIBSL( 2.51%), NABBC( 2%), TBBL(1.93%). Whereas, NSMPO(-71.17%), MFCL( -9.83%), BLDBL( -8.77%), NICB( -7.48%), NHPC( -5.95%). comprised of the top five losers.

NIC in Narayanghat

KATHMANDU: NIC Bank opened its 22nd branch at Narayanghat on Monday. The branch provides a full range of products and services including modern banking facilities. It is connected to all other branches through a V-SAT network enabling real-time online connectivity. The bank, running in profit, will open branches at Teku and Malangwa also. Its NPA currently stands at a mere 0.9 per cent. — HNS