KATHMANDU: Economic Digest offers a concise yet comprehensive overview of significant business happenings in Nepal, presented in easily digestible summaries.
Banks accumulate Rs 793 billion in loanable funds
Banks and financial institutions (BFIs) in the country have accumulated loanable funds amounting to Rs 793 billion due to their inability to issue loans as anticipated.
This shortfall is primarily attributed to low demand for credit in the market. According to Gunakar Bhatta, spokesperson for Nepal Rastra Bank (NRB), even BFIs not facing capital adequacy issues have struggled to lend adequate amounts. Despite NRB’s efforts to increase private sector lending by 11.5 percent this fiscal year, only 4.7 percent growth has been achieved in the first 11 months.
Consequently, the credit-deposit ratio has dropped to 79.18 percent, well below the central bank’s ceiling of 90 percent. BFIs currently hold deposits totaling Rs 6.335 trillion but have only extended loans amounting to Rs 5.149 trillion. Moreover, BFIs collected an additional Rs 69 billion in deposits in the past week alone.
Gold prices surge in domestic market; silver remains stable
On Friday, the Nepal Gold and Silver Dealers’ Association reported a significant Rs 100 increase in domestic gold prices, with fine gold priced at Rs 144,400 per tola and standard gold at Rs 143,700 per tola, up from Rs 144,300 per tola on Thursday.
This rise contrasted with stable silver prices holding at Rs 1,870 per tola. The fluctuation in gold prices underscored its sensitivity to economic factors like inflation, geopolitical tensions, and currency fluctuations, reflecting its role as a barometer of market sentiment and economic uncertainty.
Analysts and investors closely monitored these developments given gold’s traditional status as a safe-haven asset. It’s noteworthy that a tola equals approximately 11.66 grams, providing context for understanding the scale of these price adjustments in the local market.
Parliamentary committee summons operators of 29 cooperatives over embezzlement probe
A parliamentary special committee investigating the misappropriation of depositors’ funds by several cooperatives has called in operators from all 29 implicated cooperatives for questioning.
Coordinator Surya Bahadur Thapa announced that failure to cooperate would lead to legal action. The committee, formed on May 28 to probe financial irregularities across these cooperatives, aims to scrutinize their operations, financial systems, regulatory oversight, and transparency, ultimately making recommendations to the government.
The inquiry follows sustained pressure from the opposition Nepali Congress, concerned particularly with allegations against Home Minister Rabi Lamichhane. Recent activities include seeking financial details from nine identified cooperatives amidst widespread misappropriation claims totaling over Rs 200 billion in depositor losses from 54 major cooperatives.
Malaysia airlines hosts inaugural trade summit to boost tourism and aviation hub goals
Malaysia Airlines hosted its inaugural Malaysia Airlines Trade Elevation Summit 2024, the largest airline trade event ever held in Malaysia, in partnership with Tourism Malaysia and the Malaysia Convention and Exhibition Bureau.
The summit gathered 300 delegates, including over 200 international attendees from 48 cities and 21 countries. This event is a significant step for Malaysia Airlines as it prepares for Visit Malaysia Year 2026, aiming to position Kuala Lumpur as a key gateway in Asia and strengthen Malaysia’s role as an ASEAN tourism and aviation hub.
Captain Izham Ismail, Group Managing Director of Malaysia Aviation Group, emphasized the summit’s role in fostering global partnerships and advancing Malaysia’s tourism objectives through collaboration.
(Compiled and prepared by Srija Khanal)
Economic Digest is a daily morning economic digest, basically relatable summations of the most important business news, and happenings from Nepal into easy-to-understand summaries.
Comment