UML BARDIYA WOMAN LEADER SHOT DEAD

STRIKES PARALYZE LIFE IN FAR-WEST AND EAST

Kathmandu, 29 Aug.: Strikes Monday paralyzed life in nine east districts and the far-West.
A three-day continuous strike disrupted normal life in nine districts east of Arun river.
Sanghiya Limbuwan Rajya Parishad is demanding implementation of past accords with government for regional autonomy and promulgation by a constitution by 31 August a deadline which won’t be met.
A two-day strike by Loktantrik Pradesh closed down districts in the far-West.
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UML LEADER SHOT DEAD IN GULARIYA

Kathmandu, 29 Aug.: UML leader Indira Bhusal,40, Bardiya district committee member was shot dead in Gulariya overnight at 10.
A group shot Bhusal dead at her home.
Her body was riddled with two bullets.
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BANK DEPOSIT GROWTH RATE SLOWS DOWN
Kathmandu, 29 Aug.: The commercial banks’ deposit mobilisation witnessed sluggish growth in the last fiscal year as the average deposit growth rate slowed down by more than two times compared to a fiscal year ago, Dikshya Singh writes in The Himalayan Times.

According to the unaudited fourth quarter financial reports of the commercial bank for the last fiscal year, the deposits in the commercial banks grew by only 10 per cent in the fiscal year 2010-11, while it had grown by 12.9 per cent in the fiscal year 2009-10, whereas in 2008-09, the deposits with the commercial banks had surged by 32.25 per cent to Rs 557.75 billion. The deposits with the commercial banks reached a little over Rs 688 billion which was around Rs 625 billion a fiscal year ago, according to the central bank.

The deposit growth rate had slowed down since last two fiscal years due to deepening liquidity crisis fuelled by the delayed budget in the successive fiscal years. The deposits held by the commercial banks have grown at the average pace of 1.57 per cent, however, the deposits had expanded at the average rate of 3.66 per cent, according to the data published by the central bank.

The four new commercial banks contributed mere Rs 12 billion in Nepali banking system’s deposit creation substantiating the belief that larger number of banks does not translate as more deposits.

Five commercial banks’ deposits declined in the last fiscal year compared to a previous fiscal year, among the 27 old commercial banks that have completed two whole fiscal years of operation. Deposits with Janata Bank saw surging by 300 per cent in its second year of operation. Rastriya Banijya Bank has the largest deposit base with Rs 74 billion followed by Nepal Investment Bank that has Rs 50 billion deposits.

The growing mistrust in the banking system due to failure of the financial institutions and growing popularity of credit and saving cooperatives diverted the resources from the commercial banks, according to the central bank.

According to the study conducted by Department of Cooperatives, the saving and credit cooperatives were found to be mobilising deposits worth Rs 122 billion. The delay in budget release stalled funds from government coffer to the market reduced funds with the banks in the first six months of last fiscal year. The tight liquidity in the financial sector translated into liquidity crunch leading to credit crunch ultimately pushing lending interest rate up. The higher rate of interest but increased cost of investment that ultimately hurt productive capacity.

NEPAL-BHUTAN CARD PYMENT

The central bank has allo-wed commercial banks and national level development banks issuing debit and credit cards that can also be used in Bhutan to make settlements of transaction in Indian currencies with Bhuta-nese counterparts. The provision does not allow to settle transactions conducted of any other foreign currency besides Nepali and Indian Currency.
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