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RELATIONSHIP CONSIDERATENESS OF NON-PERFORMING LOANS (NPL) OF BANKS AND FINANCIAL INSTITUTE: A PROVINCIAL CASE STUDY OF NEPAL

    2 Author(s):  MR. BUDDHI KUMAR MALLA, PROF. DR. KESHAB DUTTA AWASTHI

Vol -  7, Issue- 1 ,         Page(s) : 17 - 25  (2020 ) DOI : https://doi.org/10.32804/IRJMSI

Abstract

In banking sector, the commercial loans are considered as the Non-Performing Loans (NPL), where the bearers default to pay within the timeline. On other hand, Banks and Financial Institutes (BFI) are the prime institutes of the nations who played role to perform the country policy and economic growth due to its service. Nepalese economy is influenced with the banking performance, which not only support nations also provided abundant support to the various sector. This case study designed to identify the major association factors that influence the NPL in the banking sectors. Throughout a mixed methods analysis some 140-sample survey from the bankers from two-Provinces of Nepal conducted in 2018. The study results illustrated that the various factors (Compliance Policy, credit risk Management, strict monitoring with good credit policy and other factor) are unswervingly concomitant in order to controlled the NPL where as high lending with high interest rate, rapid credit inflow, tremendous increase in waiver and large volume of borrowers are the major cause of massive increase in credit loan. A sound Credit policy with training upgradation to the banking resources is essential whereas study suggested making a communication to the clients to increase the business profitability.

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