Finance Minister Shankar Prasad Koirala said on Tuesday that the government has adopted a policy aimed at reducing its stake in the state-owned banks to pave the way for efficient management, capital and technology in those institutions.
He said that such a policy would rid the government-owned banks from political intervention. Speaking at the 47th anniversary of the Agriculture Develop-ment Bank Limited (ADBL), Minister Koirala said this policy would help making the government-owned bank more competitive.
In the recent time, the government has been working to bring strategic partner in the ADBL, which has the largest paid up capital base. The government has the largest stake in the bank, with investments also in Rastriya Banijya Bank, Nepal Bank and NIDC Development Bank. Rastriya Banijya Bank is the fully government-owned bank.
Nepal Rastra Bank Governor Yubaraj Khatiwada said it was not unusual for the shareholder with a higher stake in the company seeking control over it.
“So, it is necessary to bring down the government stake to keep the bank free from the state intervention,” he said.
Stating that the size of bank would not make a big difference, he suggested making the bank competitive through prudent utilisation of resources.
A number of banks have been investing even below the base rate which would hit the banks’ profitability, Khatiwada warned. Stressing the need for reducing the operational cost, he said that the central bank would treat differently to banks with higher operation cost due to lending into the productive sector.
ADBL CEO Tej Bahadur Budhathoki expressed his discontent at the government’s apathy towards issuing a directive on subsidies to be provided on the banks’ investment on livestock and warehouse business.
source: the kathmandu post,21 jan 2014
LINK
He said that such a policy would rid the government-owned banks from political intervention. Speaking at the 47th anniversary of the Agriculture Develop-ment Bank Limited (ADBL), Minister Koirala said this policy would help making the government-owned bank more competitive.
In the recent time, the government has been working to bring strategic partner in the ADBL, which has the largest paid up capital base. The government has the largest stake in the bank, with investments also in Rastriya Banijya Bank, Nepal Bank and NIDC Development Bank. Rastriya Banijya Bank is the fully government-owned bank.
Nepal Rastra Bank Governor Yubaraj Khatiwada said it was not unusual for the shareholder with a higher stake in the company seeking control over it.
“So, it is necessary to bring down the government stake to keep the bank free from the state intervention,” he said.
Stating that the size of bank would not make a big difference, he suggested making the bank competitive through prudent utilisation of resources.
A number of banks have been investing even below the base rate which would hit the banks’ profitability, Khatiwada warned. Stressing the need for reducing the operational cost, he said that the central bank would treat differently to banks with higher operation cost due to lending into the productive sector.
ADBL CEO Tej Bahadur Budhathoki expressed his discontent at the government’s apathy towards issuing a directive on subsidies to be provided on the banks’ investment on livestock and warehouse business.
source: the kathmandu post,21 jan 2014
LINK
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