Investment Policy of Commercial Banks of Nepal (A Comparative Study of Himalayan Bank Ltd. & Lumbini Bank Ltd.)

Abstract

Investment is a very popular, well known and prestigious word in financial term. Now a day’s all people want to invest their money in the best firm for good return but the return may be favorable or unfavorable for the investor’s standpoint. Investment promotes economic growth and contributes to a national wealth. Bank and financial companies are such type of financial institution, which deals in money and substitute for money, or they deal with credit and credit instruments. Good management of credit or credit instrument is very important for the banks financial institution to collect fund and utilize it in good investment sector. Bank investment operations are operated by investment policy. Investment policy plays an important role to growth for every bank. A sound and viable investment policy can be effective to increase national GDP and per capital income. If there are better investment policies adopted by banks, both investors, customers, shareholders are motivate to invest banking sector which helps to increase the value and quality of loans, deposit and investment. Good investment policy ensure maximum amount of investment to all sector with proper utilization. But if there is bad investment policy return should be negative. So to get success in competitive market commercial banks clearly know about good investment policies. The main objective of the study is to examine and evaluate the investment policy of Himalayan Bank Ltd. And Lumbini Bank Ltd. and compares it with the investment policy of HBL. For the purpose of preparing of the report financial and statistical tools are being used. Information and data of 5 years collected from primary and secondary sources. Questionnaire and interview with the officials are the major sources of primary data, whereas, the secondary data collected from annual report and web site address of the concerned two Banks.