LIGHTNING STRIKES KILL SIX IN THREE DISTRICTS

SIX KILLED IN LIGHTNING STRIKES IN THREE DISTRICTS
Kathmandu, Two women died when lightning struck their houses at two villages in Tanahu overnight.
Two persons were killed and seven were injured by lightning strike at Ghanruk, Dolakha, Wednesday.
Two persons were killed in Dumariya, Kailali, as well.
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BODIES OF 150 WORKES BEING AIRLIFTED FROM SAUDI ARABIA
Kathmandu, 19 May: The protracted wait of family members to receive the bodies of their loved ones who died in Saudi Arabia will be over soon, The Kathmadu Post reports.
The government is mulling ferrying the bodies of Nepali migrant workers who lost their lives in the Gulf country.
According to government officials, a high-level task force comprising representatives of the ministry of foreign affairs, finance, the department of Foreign Employment and Foreign Employment Commission Board will be flying to Saudi Arabia to lobby with the government of Slaudi Arabia to get back those workers’ dead bodies that date back 18months to two years, within a couple of months.
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IMF TO HELP NRB UPGRADE SUPERVISORY ROLE

Kathmandu, 19 May: International Monetary Fund (IMF) is helping Nepal Rastra Bank to strengthen its supervisory capacity following a spate of governance problems and irregularities at financial institutions. As part of the assistance, the IMF has sent a consultant to coach the central bank, The Kathmandu Post reports.

NRB wants to intensify its supervision as it suspects banks and financial institutions (BFIs) of hiding some of the financial indicators which may pose a long-term risk to the financial system. According to the central bank, the average non-performing asset (NPA) of commercial banks is in the range of 2-4 percent.

Considering a prolonged liquidity crunch and a slowdown in real estate and the stock market, NRB estimates that the NPA level should have increased. An NPA is a loan on which interest payments are not being made and is in danger of going bad.

The central bank feels that lack of sufficient human resources has reduced its supervisory capacity. With the number of BFIs increasing rapidly in the past few years, the central bank has been struggling to carry out onsite inspections.

Meanwhile, NRB has been working on new directives to control overdrafts by BFIs. “The tendency of taking overdrafts to repay old loans may pose a risk to the financial system,” said an NRB official. “Hence, we’re trying to manage it.”

In the first eight months of the fiscal year, lending by commercial banks has increased by Rs 54.24 billion while their deposit base has increased by only Rs 12 billion. Interestingly, loans to productive sectors have increased two-fold during this period. “However, these loans have been used in repaying old loans or as working capital instead of being invested in new sectors,” said the official.

The central bank expects the NPA to swell after it tightens overdrafts. BFIs will have to allocate more money for provisioning of bad loans which will ultimately hit their profits.

Experts said that if the central bank tightens overdraft facilities, it would affect realty prices. With most borrowers taking overdrafts to pay the interest on their loans, they might have to sell their real estate properties pushing down prices. BFIs have issued credit worth more than Rs 100 billion to the real estate and housing sector.
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