Financial Perfomance Of Finance Companies In Nepal Using Camel Framework

Abstract

This study aimed at examining the camel rating system of Nepalese Finance companies.The descriptive research design has been adopted for the study. The study used a secondary data for five finance companies. The pooled data of five Nepalese finance companies for the period 2015/16 to 2019/20 B.S. have been analyzed using different financial ratios and statistical tools. Data is obtained from banks annual report and Nepal Rastra banks annual supervision report. Capital adequacy ratio (CAR), Assets quality ratios, Management efficiency ratios, Earning ratios and liquidity ratios have been taken as camel rating indicators. The overall criteria to evaluate the banks rating consider the banking performance as a whole. It doesn’t only consider the best part of the performance but it assumes what is the best to be the best in all criteria and evaluate the banking performance in term of quality as a whole. Based on the finding, it is recommended that the banks should increase their Management Efficiency by decrease expenses because it gives the life to the institutions for the coming days. They should also focus on their assets quality to ensure their existence in long run. The liquidity position of the sample Finance Companies should meet its current and contingent obligations.