Investment Portfolio of Nepalese Banks
Chapter – 1
INTRODUCTION
1.1 Background of Study
The economy of nation depends on the uses of available resources in efficient way. The proper utilization of assets appreciates in wealth position of individual and country as well. To mobilize available resource, there should be proper planning, efficient management, far sighting strategy, good financial management and up-to-date information. Integrated and speedily development of the country is possible only when competitive banking and financial service reaches nook and corners of the country. To grow financial activities, it requires the banking habit of the community as well as potentially strong lending opportunities. Simply, Bank is an institution whose main function is to accept deposit and invest it. Bank collects money from public by providing attractive sound interest and can earn profit by lending it on mainly in business organization, industrial, agricultural sectors etc. So, we can say the main task of commercial bank is to mobilize idle resources in productive areas by collecting it from scattered sources and generating profit. Banking plays significant role in the economic development of country. Banks role as intermediaries channeling between saving and investment and fulfill the credit needs of customer as well as investment requirement of savers. It is clear that efficient and stable banking systems are crucial for an orderly economic growth. The pace development of country largely depends on the level of financial development.
Successfully formulation of investment policy and its proper utilization or implementation is the prime requisite for the development of performance of banks and other financial institution. Good Investment policy has positive impact on economic development of the country and vice-versa. A healthy development of any banks depends heavily upon its investment policy. A sound and viable investment policy is one of the major effective for the economy to attain the
INTRODUCTION
1.1 Background of Study
The economy of nation depends on the uses of available resources in efficient way. The proper utilization of assets appreciates in wealth position of individual and country as well. To mobilize available resource, there should be proper planning, efficient management, far sighting strategy, good financial management and up-to-date information. Integrated and speedily development of the country is possible only when competitive banking and financial service reaches nook and corners of the country. To grow financial activities, it requires the banking habit of the community as well as potentially strong lending opportunities. Simply, Bank is an institution whose main function is to accept deposit and invest it. Bank collects money from public by providing attractive sound interest and can earn profit by lending it on mainly in business organization, industrial, agricultural sectors etc. So, we can say the main task of commercial bank is to mobilize idle resources in productive areas by collecting it from scattered sources and generating profit. Banking plays significant role in the economic development of country. Banks role as intermediaries channeling between saving and investment and fulfill the credit needs of customer as well as investment requirement of savers. It is clear that efficient and stable banking systems are crucial for an orderly economic growth. The pace development of country largely depends on the level of financial development.
Successfully formulation of investment policy and its proper utilization or implementation is the prime requisite for the development of performance of banks and other financial institution. Good Investment policy has positive impact on economic development of the country and vice-versa. A healthy development of any banks depends heavily upon its investment policy. A sound and viable investment policy is one of the major effective for the economy to attain the