The bank has also revised its special fixed deposit schemes, under which the customers can now open accounts at Rs 111,000. Previously, the customers could open accounts under this scheme at Rs 555,000. The bank has is also planning to install seven new ATMs within this fiscal. It also formally launched internet banking services from Thursday. The bank also said that it would start issuing loans against gold and gold jewelries by the end of this fiscal.Source:
myrepublica.com
Friday, April 30, 2010
NB Bank opens 18th branch
Sunrise Bank at Harisiddhi
Source:
ekantipur.com
Depositors lose confidence
Despite various measures commercial banks could not increase the deposits, the deposit mobilisation has increased by only 4.2 per cent amounting to Rs 22.9 billion till the first eight months of the current fiscal year. According to the Nepal Rastra Bank (NRB)'s macroeconomic report of first eight months of current fiscal year, the total deposit amount with the commercial banks increased by only 4.2 per cent to Rs 572.7 billion whereas in the same period of last year the total deposit had increased by 14.3 per cent. Currently, the banks and financial institutions (BFIs) are distressed due to dwindling deposits so that they have been raising the interest rates to attract new deposits. The money coming in the bank is waning mainly due to loss of confidence in the banking system and due to shrinking remittance inflows. The shortage of cash last October has also played a major role. Likewise, due to Anti-money Laundering Act people are apprehensive to go to banks to deposit the money, though the Act has been brought according to the international rule. Under the act, a depositor who deposits more than Rs 1 million needs to disclose the source of income while depositing at the BFIs. To avoid disclosing the source, the depositors are shying away from banks to deposit the large amounts. Lack of awareness among the depositors has caused a huge loss of deposits. The private sector credit of commercial banks has increased by 16.5 per cent. Among the total private sector credit, the credit to production sector increased by 9.5 per cent in the first eight months of the current fiscal year in comparison with the growth of 12 per cent in the samer period last year. Under the production sector credit, the credit to sugar, cement, iron and steel industries observed a greater credit expansion. Similarly, credit to agriculture sector has also increased by Rs 2 billion. "Credit to wholesale and retail businesses has also expanded by 23.2 per cent and the credit to finance, insurance and fixed assets also increased by 41.6 per cent while the credit to service sector increased by 20.2 per cent," said the report. The credit to real estate sector was extended to Rs 14.9 billion as compared to Rs 7.7 billion in last year's corresponding period. The liquid assets of the commercial banks stand at Rs 167.9 billion by mid-March. Among the liquid assets, liquid fund has declined by 9.7 per cent. This decline in liquid fund of commercial banks is attributed to the decline in commercial bank's balance with the NRB as well as balance held abroad. The balance held abroad by commercial banks has gone down by Rs 4.3 billion amounting to Rs 49.2 billion whereas the balance with NRB has declined by Rs 10.1 billion. Similarly, commercial bank's investments in government securities have also declined by 12.3 per cent. The liabilities, assets structure of commercial banks has also changed due to higher growth of commercial banks' loans and advances relative to their deposit mobilisation. The serious concern is credit to deposit (CD) ratio. The CD ratio increased to 90.2 per cent in mid-March from 81.2 per cent in mid-July 2009. "The liquidity-deposit ratio also declined to 29.3 per cent in mid-March 2010 from 34.2 per cent in mid-July 2009," said the report.Source:
THT
Sunday, April 18, 2010
Siddhartha Bank open five branch office
Source:
THT
Fire breaks out at Nepal Bank Limited
Nepal Bank Limited (NBL), the oldest state-owned bank caught fire on Saturday morning. The fire started at 5:00 am and was brought under control only at 8: 45 am. Binod Atreya, chief executive officer of the bank said that the fire destroyed two storerooms that had old documents. "Documents that were destroyed were kept for disposal," he said. According to him, there were no important documents related to customers or the bank that were destroy by fire. The actual loss has not been ascertained yet. The bank said that there was a minor loss of the old papers kept for sell through auction and two storerooms. "As the fire started in the old storehouse at the back of the bank, the immediate response from the Nepal Army, Armed Police, Nepal Police and fire brigade was to take control of the fire to prevent its spread in the main building," Atreya said. The blaze was controlled by four fire engines. He further said the reason for the fire was unknown, but old electric appliances and other equipments kept in the storehouse might be the reason. Some 150 personnel of Nepal Army, 250 from Armed Police and 50 from Nepal Police were deployed to control the fire. NBL is the oldest commercial bank of Nepal established in 1937, which marked the beginning of an era of formal banking in Nepal. The Bank is also one of the largest in Nepal with 107 branches in 55 districts of the country. It was formed under the principle of joint venture between the government and public. NBL's authorized capital was Rs 10 million and issued capital Rs 2.5 million of which paid-up capital was Rs 842,000 with 10 shareholders. As of mid-Jan 2010, the bank has paid up capital of Rs 380 million. The capital fund against risk weighted assets in the same period was negative by 21.27 percent and the non-performing loans at 3.77 percent.Source:
ekantipur.com
Wednesday, April 7, 2010
ADBL's IPO oversubscribed by 150%
The initial public offering (IPO) of Agricultural Development Bank Ltd (ADBL) has been oversubscribed by one and a half times till Tuesday, the third day of the issue. Siddhant Raj Pandey, Chief Executive Officer of Ace Development Bank - the issue manager for the largest ever IPO in the country, told media persons that about 55,000 people have subscribed for shares worth Rs 1.4 billion till Tuesday evening. "The warm response from the public despite liquidity crunch and sluggish stock market has encouraged us. We have found equal response to the issue both in the capital and other parts of the country," Pandey said. He said application for shares worth Rs 390 million was collected by ADBL´s branches in the capital alone. "Most of the payments for applications were made through banking system in the capital, while home deposits were used in rural areas," he added. He said applications for subscription will be closed from Wednesday evening. ADBL has issued IPO of 9.6 million units of shares worth Rs 960 million from Sunday. Bank officials and the issue manager have claimed that the banks share will be oversubscribed by five times due to sound financial performance of the bank. A total of 288 outlets have been set up to collect applications across the country.Source:
myrepublica.com
Wednesday, March 31, 2010
Nepal Telecom (NT) decides 35% cash dividend
"The per share income has also increased to Rs 67.85 that is also an increase of 28 per cent," said the NT, which has been listed under the Class-A companies at the Nepal Stock Exchange (Nepse). "NT's teledensity has increased to 17.84 telephone lines per 100 persons," Sushil Ghimire, NT chairman said, addressing the shareholders. "We have extended our PSTN (land line) services in all the 75 districts headquarters," he said, adding that GSM and CDMA service of NT is also available across the country. Registered on 2060-10-22 under Company Act, 2053, the then Nepal Telecommunications Corporation (NTC) was dissolved and all assets and liabilities were transferred to Nepal Telecom (NT) with effect from April 13, 2004. The company had floated its shares under the divestment programme of the government and called the bid for its shares quoting Rs 600 minimum after adding Rs 500 premium to the face value of Rs 100 for each unit. However, investors have quoted a maximum of Rs 2,550 to the lowest of Rs 600 for a unit of share. As part of the disinvestment and privatization plan, the government had sold NT's 10 per cent shares ¿ five per cent to the public and five per cent to the staff. The staffs were offered the shares at a subsidized rate of Rs 90 per unit. The NT, according to the Finance Ministry's divestment plan, floated 75,00,000-unit of shares ¿ that is five per cent of the total ¿ in the first phase to the public. However, due to various reasons, it was under-subscribed to only above 53,00,000-unit shares. Last year, in the first AGM, it had distributed 25 per cent cash dividends. But with increasing profits, NT has decided to disburse 35 per cent cash dividend this year.Source:
THT
Sunday, March 28, 2010
Sunrise reaches Udaypur's Jaljal
Source:
ekantipur.com
New banks to come with a bang
With the banking system facing a liquidity crunch and the central bank tightening lending in the real estate sector, upcoming banks say they will come have to come up with new strategies to tackle the situation. While the existing banks are finding it hard to attract deposits, the new banks will have to make extra efforts to get an entry into the market. According to NRB, the liquidity situation is improving as is evident with the inter-banking lending decreasing to six percent and subscription of repo (NRB injecting money against treasury bills of banks) issued by NRB standing at just Rs. 4.96 billion against the offer of Rs. 9 billion. The existing situation prompted upcoming Civil Bank to adjourn its plan to start operations by April-May to the new fiscal year that begins in Mid-July. Civil Bank's CEO Kishor Maharjan said the plan of launching operations was differed as the bank didn't want to produce a balance sheet reflecting losses as a result of a bad market situation. Banks CEOs will be under pressure for performance. High ranking officials of the upcoming banks admitted that it was a tough time to start new banks. But, they were also convinced that their new strategies would work. Maharjan said that they could learn a lot from current crisis and they could take appropriate policies without fear to reduce lending to the real estate sector and maintaining credit and deposit (C/D) ratio as directed by NRB. Former CEO of Sunrise Bank said his bank plans to introduce attractive deposit schemes with competitive interest rates and efficient services for customers. Anil Shah, CEO of upcoming Megha Bank said his bank would offer highly sophisticated ' five start banking' services to customers. "We may increase operating hours, offer door-step banking and provide more efficient service while providing loans to customers," he said. "Being a new bank, we will have to offer competitive interest rates as well to attract depositors." Of course, there will be big challenges for new banks to attract depositors. "But, one advantage for us is that we will be able to get deposits and provide credit at higher interest rates and we will save on adjustment costs of old loans as in the case of old banks," the former CEO of Nabil Bank said. The Megha is planning to start banking transaction within mid-May. Likewise, CEO of Century Bank Ganesh Kumar Shrestha said that the bank's approach would be to provide door to door service to the customers to attract deposits and lend. "Another strategy will be to keep spread rate low offering better interest rates for both depositors and loan borrowers," he said. Century is planning to start operations within the next 2-3 months. "We will probably start banking transactions from the new fiscal year," Shrestha said. Commerz and Trust Bank CEO Anal Bhattarai said his bank would address the liquidity crunch through 'product diversification' while declining to clarify what it meant. He said that the ongoing crisis was a lesson for upcoming banks and they have a chance to make appropriate preparations to tackle the situation.Source:
ekantipur.com
Wednesday, March 17, 2010
Face value of listed shares up four fold in five years
Face value of listed shares in Nepal Stock Exchange (Nepse) has jumped by four times in five years, thanks to the rise in the number of Initial Public Offerings (IPOs) and issues of rights and bonus shares by banks and financial institutions to raise their capital base. According to Nepse - the sole secondary market in the country, total face value -- paid up value of shares -- shot up to Rs 61.14 billion during the fiscal year 2008/09 from Rs 12.01 billion recorded in 2003/04. Similarly, the total number of listed shares in Nepse rose to 637.8 million units in fiscal year 2008/09 from Rs 243.5 million units recorded in 2006/07. Securities Board of Nepal (SEBON) - the capital market regulator -- had given permission to issue ordinary shares and rights shares worth Rs 8.56 billion to different companies till mid-March 2010. A total of 18 companies have been allowed to issue ordinary shares worth Rs 2.4 billion whereas 20 companies are permitted to issue rights shares worth Rs 6.52 billion. As of mid-March, 16 more companies have sought permission from SEBON to issue public shares worth Rs 6.31 billion and 12 companies have approached the capital market regulator for issuing rights shares worth Rs 409.4 million. Share analysts have suggested authorities concerned to raise the number of investors by expanding internet based trading system to deal with the increasing flow of shares in the secondary market. "We have to adopt modern technology in share trading so that more and more investors can be encouraged in share investment," said Nanda Kishore Mundada, president of Nepal Stock Brokers´ Association. He also suggested increasing foreign investment in the secondary market by attracting non-resident Nepalis and overseas investors. Investors have suggested authorities concerned to introduce a provision for easy and hassle free loan so as to encourage more investment in the secondary market, which has been flooded with new rights and bonus issues in recent years. "Rising volume of shares won´t be a problem in the market if there is guarantee of bank loans to invest in shares," said Nirmal Pradhan, a stock investor. Last year, 63 companies had received permission to issue ordinary and rights shares worth Rs 14.83 billion. As per the directives of Nepal Rastra Bank, banks and financial institutions must raise their paid-up capital base to Rs 2 billion by 2013/14.Source:
myrepublica.com
