A Study on Investment Policy of Nepalese commercial Banks (With Reference Toebl, Nbbl And Cbl)

Abstract

The investment is the management of the surplus resources in such a way that it will provide benefits to the supplier of the funds that is banks. The investment policy of a bank consists of earning high returns on it sun loaned resources. But it has to keep in view the safety and liquidity of its resources so as to meet the potential demand of its customers..The purpose of this study is to draw some ideas concerning to maintain good investment policy and to see what new contribution can be made and to receive some ideas, knowledge and suggestion in relation to maintain good investment policies of sample banks.This study is based on secondary data of 3commercial banks for the period of2013/14 to2017/18. Data and information has been collected from annual report of selected commercial banks. The research design adopted in this study is descriptive research design for fact-finding and searching for adequate information about Nepalese commercial banks. Financial tools & Statistical tools has been used for study.After study and analysis of given data we conclude that all the banks are running in profit.The profitability ratios of all three banks have positive relationship shows the efficiency of the lending. The assets management ratios of all three banks are positive. The mean ratio of loan and advances to total deposit ratio of NBBL,EBL and CBL were 76.75%, 74.22% and 85.63% respectively. This shows all banks highly utilize the depositors fund to earn profit by providing loan and advances. Similarly, the trend value of net profit & total investment is increasing trend with fluctuating rate.The trend value of total deposit, loan and advance have increasing trend which is a good sign for the bank to grow. All the banks had invested fewer funds to share and capital of other company and mostly invest on government securities, NRB bond and share and debentures of other company.Diversification of investment is highly suggested to the selected bank as they have given priority to invest in government securities.All banks seem risk avoider as they have invested highest amount in risk free securities. Higher the risk higher will be the profit