management

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Browsing management by Author "Aakash Subedi"

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    FINANCIAL PERFORMANCE ANALYSIS OF NEPALESE COMMERCIAL BANK: USE OF CAMEL RATING FRAMEWORK
    (Shanker Dev Campus, 2024) Aakash Subedi; Asso. Prof. Pitamber Lamichhane
    This study examines the financial performance of ten commercial banks in Nepal using the CAMEL model over the period from fiscal years 2013/14 to 2022/23. Through the analysis of secondary data, the research evaluates various financial indicators including Capital Adequacy Ratio (CAR), Core Capital Ratio (CCR), Non-Performing Loan Ratio, Loan Loss Coverage Ratio, Loan Loss Provision Ratio, Management Efficiency Ratio (MER), Earnings Per Share (EPS), Return on Equity (ROE), Return on Assets (ROA), Cash and Bank Balance Ratio, and Investment in Government Security Ratio. The findings suggest that while most banks met regulatory requirements for CAR and CCR, government-owned banks initially faced challenges but improved gradually. Despite an initial decrease, non-performing loan ratios are currently increasing, indicating difficulties in loan recovery and profitability. There’s a noticeable decline in management efficiency ratios, except for Standard Chartered Bank, suggesting potential issues with staffing and operational effectiveness. Earnings quality indicators such as EPS, ROE, and ROA exhibit fluctuating or declining trends, emphasizing the need for banks to enhance profitability while minimizing costs. Liquidity management poses challenges, with decreasing trends observed in cash and bank balance ratios, indicating potential difficulties in meeting short-term obligations. Investment patterns in government securities fluctuate, underscoring the importance of maintaining adequate liquidity positions. The implications drawn from these findings suggest addressing weaknesses in asset quality, operational efficiency, earnings quality, and liquidity management. Recommendations include improving loan recovery processes, optimizing staffing levels, enhancing profitability, and maintaining adequate liquidity reserves. In conclusion, this research offers valuable insights into the financial performance of Nepalese commercial banks and provides strategic recommendations to enhance their stability, profitability, and overall financial soundness.