OLI SAYS INDIA DESIRES CONSENSUS GOVT. Kathmandu. 24 Aug,: UML third-ranking leader KP Sharma said loudly and with pride Thursday Indian leaders favored a government of national consensus in Nepal. ‘Indian leaders want a government of national consensus,” Oli said as he returned from the Indian capital following extensive discussions with leaders in the couth. Oli said this as Chairman Prachanda said his party will rule for another 25 years and amid public readiness to form a national consensus government on their terms. Opposition , including NC and UML, is also pushing for a national consensus government and on their conditions as well, including immediate resignation of Prime Minister Baburam Bhattarai. nnnnr RUKUM HIT BY MILD QUAKE Kathmandu, 24 Aug.: Rukum was hit by a moderate earthquake measuring 5.6 on the Richter scale Thursday at 10:15 in the night. The epicenter was in the south part of the far-West district. Nnnn MEDIA GOOGLE “Social security and development funds in some Tarai districts have been embezzled at a massive scale, says a preliminary report of the Ministry of Federal Affairs and Local Development, pointing at the involvement of government officials in the misappropriation. “The amount embezzled is about double the size of social security budget necessary for the whole district in a fiscal,” (Dinesh Kumar Thapaliya, Spokesperson for the ministry of federal affairs, The Himalayan Times, 24 Aug.) nnnn . BANKS NEED TO EXPAND THEIR PORTFOLIO Kathmandu, 24 Aug.: The insignificant growth in operating profit and net interest income of the commercial banks is signaling need for banks to expand their investment portfolio in spite of net profit growth, The Himalayan Times writes. The commercial bank’s operating profit has increased by a nominal 2.43 per cent in the last quarter of fiscal year 2011-12, according to the recently published unaudited financial reports of the commercial banks. Likewise, net interest income of the 32 commercial banks has also grown by a mere five per cent, even though their net profit had shown ascent of 12 per cent in the last fiscal year. In the last quarter, operating profits of the banks stood at Rs 16.41 billion while a year ago they had earned Rs 16.02 billion. The operating profit is the profit earned from a bank’s normal core business operations sans any windfall gains and losses. Likewise, the class ‘A’ financial institutions have recorded net interest income worth Rs 32.84 billion in the fiscal year 2011-12, which stood at Rs 31.26 billion in the same period of last fiscal year. Net interest income is simply difference between revenues generated by interest-bearing assets like loans and interest-burdened liabilities such as deposits. “Shrinking growth rate of net interest income and operating profit signals that the banks are earning less from core banking activities – that is basically collecting deposits and floating loans for an interest,” said vice president of Nepal Bankers’ Association Upendra Poudel. Following the last couple of years’ liquidity crunch the increased deposit rate have attracted more than enough funds in the banks while lending is not taking off due to unfriendly investment climate in the country, which has eventually hit the core income of the banks. “The source of income for the whole industry is shrinking while cost of fund is increasing due to inflation and the necessity of expanding business, in addition, yields of alternate investment portfolios including government securities and interbank lending are at historic low,” he pointed out, stressing on the need of identifying new investment areas for the banks to improve core banking activity. Increased deposits has made total deposits with banks amounting about Rs 870 billion while the total lending is less than Rs 70 billion. Such large scale mismatch of liabilities and assets tend to weigh down on profitability of the industry but for the time being the big banks and new banks have pushed the net profit of the whole industry. The banks’ average cost of fund has not much changed in fiscal year 2011-12 compared to earlier likewise interest spread has also grown, in spite of, growing liquidity. According to the data, average cost of fund last year was 8.4 per cent which has marginally declined to 8.1 per cent in a year. Average interest spread rate of the banks stands at 3.16 per cent which stood at 3.4 per cent in the fourth quarter of fiscal year 2010-11. Nnnn UML STUDENT MEET PUT OFF FEARING VIOLENCE Kathmandu, 24 Aug.: A standing committee meeting of the CPN-UML today ordered the central leadership of its student wing – All Nepal National Free Students’ Union (ANNFSU) – to put off the planned “statute convention”, scheduled to begin in Kirtipur on August 25, indefinitely. According to standing committee member Amrit Kumar Bohara, the standing committee meeting ordered its student wing to put off its planned statute convention after it received a report from a three-member probe committee, formed to investigate “anarchic, unruly and non-political” activities prevalent in the union’s central leadership. The three-member committee, which has party secretary Yuvaraj Gyawali as its head and Gangalal Tuladhar and Bhanu Bhakta Dhakal as members, was formed to look into “hooliganism” and clashes that broke out at a function in Nepal Law Campus a few weeks ago. Sources said the panel found that secretariat secretary of ANNFSU, Ain Bahadur Mahar, was directly involved in the beating of some student leaders attending the function. The probe panel has recommended disciplinary action against Mahar. Mahar is wanted by police for his alleged involvement in hooliganism at Nepal Law Campus, according to party sources. Although the standing committee meeting stated that the statute convention was put off due to the lack of preparations, party sources told this daily that a section of ANNFSU, which is close to ethnic leaders within the UML, was making preparations to create anarchy in the party by capturing the forum of the statute convention. Sources said some ANNFSU leaders from ethnic background had held an informal meeting to utilise the statute convention to promote the cause of ethnicity. The UML’s student wing is plagued by factionalism of late and a section of ANNFSU leadership, led by Mahar, has formed parallel district-level organisations in Rupandehi, Bara, Rautahat, Taplejung, Panchthar, Ilam and Parsa. The parallel committees were formed shortly after the election of district committee leaderships were held through a legitimate process. The Gyawali panel, according to sources, found that a section of the ANNFSU leadership was indulged in factionalism, hooliganism and unruly activities that did not suit those involved in the student movement. Oli returns after check-up Senior leader of the CPN-UML KP Sharma Oli returned home after going through a follow up health check-up in New Delhi, where he also conferred with some prominent Indian leaders. Sources said the former deputy prime minister and home minister, Oli, shared views with the Indian leaders about the latest political developments in Nepal, where major parties are at loggerheads over the political and constitutional crisis since the dissolution of the Constituent Assembly on May 27. Oli’s aides said he met Congress-I and BJP leaders, and CPI-Marxist leader Sitaram Yechuri. nnnn