Finance

Permanent URI for this collectionhttps://hdl.handle.net/20.500.14540/16

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DETERMINANTS OF PROFITABILITY OF NEPALESE DEVELOPMENT BANKS
(Shanker Dev Campus, 2024) Hardik Bangdel; Dhruba Subedi
This study investigates the determinants of profitability in Nepalese development banks, focusing on the role of key factors such as bank capital, deposits, lending, size, and the CAR. Using secondary data from published financial statements and reports of selected five banks, the analysis employs correlation and regression methods to examine their impact on profitability indicators: the ROA, the ROE, and the Tobin's Q, and aims to provide a comprehensive understanding of how internal and regulatory variables impact profitability and market valuation. The findings reveal significant variability across the banks in terms of size, deposits, and lending, with substantial interdependence among these variables. CAR exhibits a negative relationship with profitability measures, suggesting that regulatory compliance may impose constraints on banks' profitability. ROA demonstrates a negative association with bank capital, deposits, lending, and size, while ROE is positively correlated with ROA, underscoring the alignment between operational efficiency and shareholder returns. Notably, Tobin‘s Q shows a weak relationship with these variables, indicating the influence of external market factors on market-based valuations, but positively correlates with ROE and ROA. The findings further highlight the limited explanatory power of the selected financial variables on profitability metrics, suggesting that while operational factors like bank lending marginally impact profitability, external and qualitative factors such as market conditions, customer satisfaction, and technological innovation warrant further investigation. This research underscores the need for a multidimensional approach to enhancing the performance of Nepalese development banks. Policymakers are urged to strike a balance between regulatory compliance and profitability enhancement, while banks should prioritize efficiency, optimize resource allocation, and embrace technological advancements to remain competitive.
INTERNAL CSR AND ORGANIZATIONAL COMMITMENT IN ORGANIZATIONS
(Shanker Dev Campus, 2024) Endrashan Chaudhary; Joginder Goet
This study examines the impact of internal CSR practices on organizational commitment in Nepalese organizations. The main objective of the study is to examine the relationship between internal CSR practices and organizational commitment of the employees in Nepalese manufacturing and other organizations. Specially the impact of five dimension of internal CSR practices on organizational commitment: Labour relation, Work-Life Balance, Health & Safety, and Training and Development, has been examined. Descriptive and casual comparative research design has been adopted. The research is based on quantitative approach where the questionnaires were administered to the 100 respondents, who are actually employees of the manufacturing and other organizations operating within Nawalparasi and Rupandehi, and were chosen under convenience sampling method. Opinion has been collected through questionnaire with six point likert scale. Collected data has been analyzed by using mean, standard deviation, correlation analysis and regression analysis. The results have significant implications for the implementation of CSR strategies within organizations. First the positive relationship between each three out of for indicator of internal CSR and organizational commitment emphasizes the payoff in term so for organizational commitment that may flow from corporate investments in CSR.
FACTORS INFLUENCING SAVING BEHAVIOR OF YOUTH INSIDE KATHMANDU VALLEY
(Shanker Dev Campus, 2024) Dipa Kharal; Dr. Pitri Raj Adhikari
This study examined elements that influence youth saving behavior, with financial literacy, parental socialization, peer influence, and self-control serving as independent variables. The study used descriptive and causal research design and data was collected quantitatively from a wide demographic sample to examine the link between these characteristics and saving behavior. The reliability study revealed strong internal consistency among the variables, with an overall Cronbach Alpha of 0.946, demonstrating robustness in the measurements used. The data show strong positive connections between financial literacy, peer influence, self-control, and saving behavior, implying that these elements play an important role in encouraging financial responsibility among young people. The regression model also shown significant predictive power, with a R Square of 0.946, indicating that the model accounts for 94.6% of the variance in saving behavior. This study adds to the area by showing the role of financial education, societal influences, and personal discipline in developing youth financial practices. The findings have practical significance for policymakers, educators, and financial institutions working to promote effective saving habits among young people through tailored financial literacy programs and support networks.
IMPACT OF DIVIDEND ON SHARE PRICE OF INSURANCE COMPANIES
(Shanker Dev Campus, 2024) Dilli Kuikel; Keshar Singh Khati / Keshav Chand
The portion of a company's overall net profit made during a certain time period is known as the dividend. Investors (the company's shareholders) split the net profit of a business based on their individual investment shares. The most crucial aspect of a company that has a direct impact on stock prices is its dividend policy. Regarding profit management, distributing profits to shareholders, and keeping a portion of profits in the business's account to take advantage of better investment possibilities down the road, the Board of Directors of the company develops and executes the dividend policy. The analysis of the effect of dividend policy on a company's stock prices is the main goal of this research. The banking industry companies were chosen in order to investigate how dividend policies affect stock prices. Three insurance businesses' ten-year (2013–2022) financial data was gathered from their websites and financial reports, as well as from the Nepal Stock Exchange website. The findings showed that a sensible dividend policy is crucial for drawing in respectable investors and significantly fortifying a company's capital structure. In order to raise knowledge of earlier research in the field, a literature survey of pertinent books and periodicals served as the foundation for the study. A significant amount of secondary data about capital structure and pertinent dividend policies of these businesses was collected in order to get a critical perspective on the dividend policies of various firms and their influence on stock prices. The internet was used extensively to get secondary data. The study's conclusions showed that if a company's dividend policies are developed and put into effect after a thorough analysis of the market's capital structure and the dividend policies of other companies, they may have a favourable and desired effect on the company's stock prices. It is anticipated that the study's findings will aid academics, business schools, and researchers in comprehending the clear relationship between a company's stock price and its dividend policy.
MACROECONOMIC FACTORS AND STOCK MARKET RETURN IN NEPAL
(Shanker Dev Campus, 2024) Anil Raj Rai; Dr. Dhan Raj Chalise
The stock market is one of the most energetic sectors that play an important role in contributing to the wealth of the economy. It plays a crucial role in the economic growth and development of an economy which would benefit industries, trade and commerce as a whole. The aim of this study is to investigate the relationship and impact of macroeconomic variables on stock market returns in Nepal. Dependent variable of this study is stock market return measured by Nepal Stock Exchange (NEPSE) and independent variables are macroeconomic variables, such as Policy Interest Rate (IR), Inflation Rate (INF), Exchange Rate (ER) in US Dollar, Industry Production or Nepal Manufacturing Output (IP) and Broad Money Supply (MS). The study targets all the companies listed and active in Nepal Stock Exchange (NEPSE) from 2014 to 2023. For analysis, secondary data was collected from annual reports of Central bank of Nepal (NRB), Nepal Stock Exchange (NEPSE), Securities Board of Nepal (SEBON) and Ministry of Finance (MOF) and Economic Bulletins. The results of the study reveal that the stock market returns is influenced by macroeconomic variables in Nepal. Inflation Rate and Policy Interest rate have negative insignificant influence on stock market return in Nepal Stock Exchange while Exchange Rate in US Dollar and Broad Money Supply have positive significant influence on stock market return and also Industrial Production has positive insignificant influence on stock market return. The findings of the study may be useful to public and economy especially stock market investors to focus the macroeconomic variables for making their effective decisions in order to enhance their stock market returns.
CORPORATE GOVERNANCE AND FINANCIAL PERFORMANCE OF NEPALESE COMMERCIAL BANKS
(Shanker Dev Campus, 2024) Alisha Silwal; Arun Neupane
This study examines the relationship between corporate governance and the performance of commercial private banks in Nepal, focusing on a sample of leading banks. The Nepalese banking sector has undergone significant changes and is now a major contributor to the economy. The study uses profitability indicators such as Return on Equity (ROE) and Return on Assets (ROA) as dependent variables, while the independent variables include various corporate governance factors. The findings suggest that the size of the Board of Directors (BOD) and the level of non-performing loans (NPLs) are negatively correlated with bank profitability. Conversely, board independence and the frequency of board meetings show a positive correlation with profitability. The results indicate a significant relationship between board size, board independence, the number of board meetings, and the profitability of banks. These correlations were validated through paired t-tests. Moreover, the study reveals that professional management is considered a crucial aspect of corporate governance. In terms of corporate governance priorities, respondents ranked shareholder protection as the most important issue, followed by professional management, and then timely disclosure. The analysis concludes that a larger BOD size is negatively related to profitability, while a higher frequency of board meetings is positively associated with profitability. In summary, better corporate governance practices are linked to improved financial performance, reflected in higher ROE for banks.
WOMEN EMPOWERMENT THROUGH MICROFINANCE IN NEPAL
(Shanker Dev Campus, 2024) Abina Aryal; Dr.Binita Manandhar
This research examines the relationship between microfinance and women‘s empowerment in Nepal, focusing on five socio-economic factors: income, education, decision-making power, family support, and asset ownership. Using quantitative methods, the study finds that microfinance positively impacts empowerment, with variations across these dimensions. Correlation analysis shows significant relationships between empowerment and all five factors, with asset ownership having the strongest correlation. ANOVA confirms that these factors collectively influence empowerment. However, regression analysis reveals that while income, education, decision-making power, and family support significantly affect empowerment, asset ownership contributes indirectly. The study highlights microfinance's crucial role in empowering women in rural Nepal.
EFFECT OF FINANCIAL LITERACY ON INVESTMENT DECISIONS IN KATHMANDU VALLEY
(Shanker Dev Campus, 2024) Susmita Thapa Chhetri; Dr. Pitri Raj Adhikari
This study examines the effect of financial literacy on investment decisions: a case of Kathmandu valley. The study has used descriptive and casual comparative research design. The sampling technique for the study followed convenience sampling. Data have analyzed by using different statistical technique such as descriptive statistic, correlation analysis and regression analysis. This study found that investors agreed that financial knowledge and financial skill highly affects their investment decision of investors and they believe that their decision is also high. The correlation analysis shows that the correlation analysis reveals that shows that there is significant position association between financial knowledge and investment decision. Similarly, financial attitude has significant positive relationship with investors’ investment decision. At the same time, there is significant positive association between financial skill and investment decision. Moreover, financial behavior has significant positive relationship with investment decision. The regression analysis shows that there is significant positive effect of financial knowledge on investment decision. Then, there is also significant positive effect of financial attitude on investment decision. At the meantime, financial skill has significant positive impact on investment decision. Finally, financial behavior has significant positive effect on investment decision. However, financial literacy has significant impact on investors’ investment decision in Nepalese stock market.
Role of Cognitive Bias in Investment Decision Making
(Shanker Dev Campus, 2024) Yagya Bahadur Ghimire; Dr. Suman Kamal Parajuli
This study explores the influence of cognitive biases on investment decision-making among Nepalese investors, focusing on overconfidence bias, illusion of control bias, anchoring bias, and loss aversion bias. Using a descriptive research design, data were collected from 384 active investors in the Nepal Stock Exchange through structured questionnaires. The results reveal that cognitive biases significantly shape investment decisions, often leading to irrational behaviors and suboptimal outcomes. Overconfidence bias emerged as a dominant factor, with investors overestimating their predictive abilities and underestimating risks. Illusion of control bias was also prominent, as participants believed they could influence market outcomes, leading to excessive risk-taking. Anchoring bias reflected a fixation on initial reference points, such as purchase prices, while loss aversion bias highlighted a tendency to prioritize avoiding losses over potential gains, resulting in poor portfolio adjustments. The findings align with behavioral finance theories, particularly Prospect Theory, emphasizing the need for financial literacy programs and behavioral interventions. This study contributes to the behavioral finance literature, offering actionable recommendations to mitigate biases and foster rational investment practices, thereby enhancing market efficiency in Nepal.
Psychological Factors on Investment Decision Making in Nepalese Stock Market
(Shanker Dev Campus, 2024) Subas Dahal; Dr. Suman Kamal Parajuli
This study explores the psychological factors influencing investment decisions in the Nepalese stock market, focusing on beliefs, self-confidence, regret and remorse, and loss aversion. The research adopts a descriptive design, utilizing structured questionnaires distributed among 150 retail investors to examine the interplay between cognitive biases and financial behaviors. Findings reveal that psychological factors significantly impact investment decisions, with loss aversion and regret being prominent drivers of conservative strategies, while self-confidence often leads to overconfident behaviors. Correlation and regression analyses demonstrate weak to moderate relationships between these psychological factors and investment outcomes, underscoring their nuanced effects. The study highlights the need for enhanced financial literacy programs and policy interventions to mitigate cognitive biases and promote rational decision-making in the Nepalese stock market. These insights contribute to the growing field of behavioral finance, offering region-specific evidence and practical implications for emerging markets.
WORKFORCE DIVERSITY MANAGEMENT AND ORGANIZATIONAL PERFORMANCE IN NEPALESE HOSPITALITY SECTOR
(Shanker Dev Campus, 2024) Sushil Khanal; Asso. Prof. Dr. Kapil Khanal
The aim of the study is to assess the workforce diversity management and organizational Performance, in the form of gender diversity, age diversity, ethnic diversity, education diversity and marital diversity. On the review of theoretical, conceptual and empirical related literature of the study, workforce diversity had a significant relationship with their organizational Performance. In conducting this study, the required data is obtained through structured questionnaires. The Instrument (structured questionnaires) was adopted from prior studies, in order to measure all variables of the study. To check the validity and reliability of the adopted instruments validity and reliability test was also carried out. To determine the sample size from the total population of the study, the researcher uses formula based-sample size determination. To select respondents from each stratum simple random sampling technique was also adopted. Basically, a total of 400 questionnaires were distributed to the sampled employee, among these 400 were returned. The respondents were more likely prioritize organization who recruited people from different level and stream of formal education. Educationally diverse workplace was observed to be more delightful to work. And there is significant positive and moderate impact of age diversity and organizational Performance. Similarly, there is less impact of ethnic diversity and organizational Performance. The result also shows significant positive and moderate relationship between education diversity and organizational Performance and also marital status and organizational Performance.
PERFORMANCE OF MUTUAL FUND IN NEPAL
(Shanker Dev Campus, 2024) Sushmita Bhandari; Rishi Raj Gautam
This dissertation studies the performance of mutual fund schemes in Nepal issued by unique fund managers and has performed over four consecutive years and aims to identify the best performing funds among seven selected schemes. The study also analyzes the influence of the NEPSE Index’s movements on the financial performance of these selected mutual funds. To assess the performance, various statistical and financial tools have been implemented, including the Sharpe ratio, Treynor’s ratio, Jensen Alpha, holding period return, Net Asset Value (NAV), and correlation coefficient. The findings of this research study will provide valuable intuition into the factors influencing mutual fund performance in Nepal, particularly in relation to the impact of market fluctuations, as reflected by the NEPSE Index. Additionally, the study intends to provide useful information for investors, fund managers, and policymakers, contributing to improved decision-making and optimizing mutual fund performance within the context of Nepal's evolving capital markets.
PROFITABILITY ANALYSIS OF COMMERCIAL BANKS IN NEPAL
(Shanker Dev Campus, 2024) Suresh Gotame; Rishi Raj Gautam
This study entitled “Profitability Analysis of commercial banks in Nepal” is secondary data-based research study. The main aim of this study is to examine the impact of profitability of three commercial banks in Nepal from 2013/14 to 2022/23. The independent variables were total loan to deposit ratio, non performing loan ratio, capital adequacy ratio, and loan loss provision ratio and bank size. The study was conducted to analyze whether or not these independent variables have significant impact on the dependent variable profitability i.e. ROA and ROE. This research used a purposive sampling method for the research. The research is quantitative in nature. Descriptive and casual comparative research design was adopted to achieve objectives of this study. These approaches were conducted using Statistical Package for Social Sciences (SPSS). It was revealed from the study that there is negative relationship of ROA with bank size. On the other hand, there is positive relationship of ROA with non-performing loan ratio, loan loss provision ratio, total loan to deposit ratio and capital adequacy ratio. Likewise, the study resulted ROE have positive relationship with non-performing loan ratio. However, the study also revealed that there is negative relationship of ROE with total loan to deposit ratio, loan loss provision ratio, bank size and capital adequacy ratio. Thus, it is essential for every commercial bank to analyze their profitability.
IMPACT OF INTEREST RATE ON STOCK MARKET PREDICTION IN NEPAL
(Shanker Dev Campus, 2024) Sauriya Lamsal; Dr. Pitri Raj Adhikari
This study examined the impact of interest rate (deposit interest, lending interest, bank rate and T-bills rate) on share market in Nepal. This study is based on descriptive and causal comparative research design. The population is based on NEPSE index and different interest rate like: bank rate, deposit rate, lending rate, short term interest rate. In this study sample for the study included different interest rate like bank rate, deposit rate, lending rate, short-term interest rate and NEPSE index of each fiscal years starting from mid July 2012 to mid-July 2023 of 11 years. The study has based on secondary data in nature. These data are analyzed through excel and SPSS. Descriptive, Correlation and Regression analysis were used to explain the relationship between the interest rate variables and NEPSE index. The correlation analysis revealed that the NEPSE Index exhibits varied relationships with the different financial rates. Notably, a positive correlation was observed with the Weighted Average Treasury Bill Rate, suggesting that increases in Treasury Bill rates are associated with higher values in the NEPSE Index. On the other hand, significant negative correlations were found with the Weighted Average Deposit Rate, Weighted Average Lending Rate, and discount Rate. The results show that the Weighted Average Treasury Bill Rate positively influences the NEPSE Index, meaning higher Treasury Bill rates lead to higher stock market values. In contrast, the Weighted Average Deposit Rate, Weighted Average Lending Rate, and discount Rate each have significant negative effects on the NEPSE Index. Specifically, increases in these rates are associated with declines in stock market performance. These findings shows the importance of financial rates in stock market dynamics and their implications for both investors and policymakers. Investors can use this knowledge to make informed strategic decisions and manage risks, while policymakers can craft policies that either stabilize or stimulate the stock market by adjusting financial rates in response to changing economic conditions. The statistically significant relationships revealed in the analysis emphasize the robustness of the results and their relevance for understanding the interactions between financial indicators and stock market behavior.
THE ROLE OF DIGITAL FINANCIAL INCLUSION IN PROMOTING ECONOMIC GROWTH IN NEPAL
(Shanker Dev Campus, 2024) Sanjita Shrestha; Asso. Prof. Pitamber Lamichhane
This study explores the impact of digital financial inclusion on economic growth in Nepal, focusing on the role of digital financial services such as mobile banking, ATMs, branchless banking, and internet banking in fostering financial inclusion and GDP growth. Utilizing secondary data from fiscal years 2013/14 to 2022/23, the study employs descriptive and causal research designs, incorporating trend analysis and correlation analysis. Findings reveal strong positive correlations between GDP and key variables like the number of bank branches, ATMs, mobile banking users, deposit accounts, debit card holders, and branchless banking services. The study concludes that digital financial services have a transformative effect on financial inclusion, providing previously underserved populations with access to essential financial services. The study provides policy recommendations urging policymakers and financial institutions to invest in both digital and physical banking infrastructure, especially in remote areas, while emphasizing the need for enhanced financial literacy programs to improve service adoption. The research contributes valuable insights for future studies on the long-term effects of digital financial inclusion on economic performance.
SUSTAINABLE INVESTMENT PERCEPTION AND ITS INFLUENCE ON INVESTMENT DECISIONS
(Shanker Dev Campus, 2024) Sanjib Acharya; Asst. Prof. Bhoj Raj Ojha
This study investigates the perception of sustainable investments and its influence on investment decisions among individuals. With growing awareness of environmental, social, and governance (ESG) factors, investors are increasingly considering the sustainability of companies when making investment choices. The research examines the relationship between key variables such as sustainable investments, governance and transparency, environmental awareness, personal values, and ethical beliefs, and their collective impact on investment decisions. Data was collected through a survey of 384 respondents, with descriptive statistics, correlation analysis, ANOVA, and regression analysis used to assess the relationships between these factors. Findings reveal that sustainable investments are perceived as important by a significant proportion of investors, with governance and transparency, environmental awareness, and personal values being key factors influencing investment decisions. Furthermore, investors demonstrated a preference for companies that align with their ethical values, and sustainable investments were seen as contributing to long-term profitability despite potential financial risks. The study highlights the growing importance of sustainability in investment decision-making and emphasizes the need for greater awareness and education on sustainable investment practices. These insights can guide investors and policymakers in promoting sustainable financial practices and fostering a more responsible investment landscape.
FINANCIAL INCLUSION ON FINANCIAL WELL-BEING OF STREET VENDORS OF LALITPUR NEPAL
(Shanker Dev Campus, 2024) Rita Bhandari; Asst. Prof. Keshar Singh Khati
The research objectives are designed to assess the current status of financial literacy, accessibility, availability, affordability, and usage in relation to the financial well-being of street vendors in Lalitpur, Nepal. Additionally, the study aims to analyze the relationship between these variables and financial well-being and examine their impact on the financial well-being of the street vendors. To achieve these objectives, a descriptive and causal comparative research design is employed. The study population includes all street vendors in Lalitpur, Nepal. Using a formula for sample size determination, 385 valid responses were collected out of 400 distributed questionnaires. The primary data collection instrument is a structured questionnaire. Data analysis is conducted using SPSS version 25 and Excel, applying descriptive statistics, correlation analysis, and regression analysis. The findings indicate a high standard deviation, reflecting significant fluctuations in the data. The current status of each variable among respondents is inconsistent, suggesting these factors are not uniformly available to all street vendors. The study reveals that financial literacy, accessibility, availability, affordability, and usage are significantly related to financial well being. Furthermore, these factors also have a significant impact on financial well-being.
ETERMINANTS OF INITIAL PUBLIC OFFERING (IPO) UNDERPRICING IN NEPAL
(Shanker Dev Campus, 2024) Rishi Ram Parajuli; Hiranya Niroula
This study investigate the determinants of initial public offering (IPO) underpricing in Nepal. The objectives of this study includes to examine the perception of investors towards IPO in Nepal, to analyze the relationship between different factors on underpricing in IPO and to examine the impact of different factors on underpricing in IPO. In this analysis, goodwill, corporate profile, financial position, lack of other investment and sector performance are the independent variables and underpricing in IPO (UP) is dependent variable. The study employ mean, standard deviation, correlation and multiple regression analysis were used to present data and draw conclusion. The major finding is that the descriptive statistics reveal that factors such as goodwill, corporate profile, financial position, and sector performance all play a critical role in determining the degree of underpricing in IPOs. In comparing the correlations, Corporate Profile (CP) shows the strongest relationship with Underpricing (UP), followed closely by Financial Position (FP) and Goodwill (GW). This suggests that firms with a stronger corporate image and financial health are more likely to engage in IPO underpricing, potentially as a strategic move to attract investors or oversubscribe the IPO. The high correlation between Financial Position (FP) and Sector Performance (SP) reflects the importance of industry conditions in determining a firm’s financial health. In regression analysis, Sector Performance, Lack of Other Investment, Goodwill, Corporate Profile, and Financial Position, collectively have a significant effect on IPO underpricing. The regression model explains about 31.1percent of the variance in underpricing, which is statistically significant as evidenced by the high F-statistic and a p-value of 0.000. However, the relatively large residual sum of squares and mean square indicate that a considerable portion of the variance in IPO underpricing remains unexplained, suggesting the need for further exploration of additional factors or a more nuanced model to capture the complexity of IPO pricing dynamics in Nepal.
PROFITABILITY ANALYSIS OF JOINT VENTURE BANKS IN NEPAL
(Shanker Dev Campus, 2024) Ravi Kumar; Dr. Prakash Kumar Gautam
This study provides a comprehensive analysis of the Profitability Analysis of joint venture banks in Nepal, focusing on Standard Chartered Bank (SCB), Himalayan Bank Limited (HBL), Nabil Bank, Nepal SBI Bank, and Everest Bank Limited (EBL). This research used a quantitative research technique. Secondary data were adopted over the last 15 years from 2008/09 to 2022/23. Joint venture banks have become key players in Nepal's financial sector, contributing significantly to economic development through increased capital inflow, efficient resource allocation, and modern banking practices. The analysis reveals distinct patterns among these banks, highlighting their individual strengths and weaknesses. Nabil Bank emerges as a leader in profitability, consistently delivering high returns on assets (ROA) and equity (ROE), underpinned by its diversified revenue streams and efficient cost management. SCB demonstrates a strong capital adequacy position, adhering to international standards and maintaining robust risk management frameworks, which ensure long-term stability. Nepal SBI Bank excels in liquidity management, showcasing its capacity to meet short-term obligations and sustain operational resilience. HBL and EBL distinguish themselves in operational efficiency, attributed to their adoption of innovative technologies, effective branch management, and customer-oriented service strategies. By providing a comparative analysis, this research identifies key drivers of success and areas requiring improvement within Nepal’s joint venture banking sector. The findings offer valuable insights for stakeholders, including policymakers, investors, banking professionals, and academics, facilitating evidence-based decision-making.
IMPACT OF CREDIT RISK MANAGEMENT ON PERFORMANCE OF COMMERCIAL BANKS IN NEPAL
(Shanker Dev Campus, 2024) Ramesh Raj Bhandari; . Bhoj Raj Ojha
This study examines credit risk management practices in Nepalese commercial banks, with a specific focus on Everest Bank Ltd. (EBL), NABIL Bank Ltd. (NABIL), and Standard Chartered Bank Ltd. (SCB). The research investigates the effectiveness of credit risk management frameworks, governance mechanisms, and the role of regulatory bodies in mitigating risks. Using secondary data from annual reports of the selected banks, regu- latory authority reports, and other relevant sources, the study analyzes various financial indicators such as credit deposit ratio, capital adequacy, non-performing loans (NPL), loan loss provisions, and lending practices. The findings suggest that while all sample banks maintain adequate capital ratios and core capital levels, EBL demonstrates superior credit risk management, particularly in terms of loan loss coverage. Conversely, NABIL faces higher credit risks due to a relatively weaker credit appraisal and governance sys- tem. The research highlights the increasing credit risk challenges faced by these banks, and the lack of diversification in their lending portfolios. The study recommends that banks enhance their loan assessment practices, focus on sustainable growth policies, and ensure regular monitoring of credit portfolios to minimize defaults. Additionally, it sug- gests that future research could expand the data set and explore different sectors to further validate the findings. Overall, the study contributes valuable insights into the current state of credit risk management in Nepalese banks and provides recommendations for improv- ing banking practices.

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