I like this piece of my article...... The failure of banks to - TopicsExpress



          

I like this piece of my article...... The failure of banks to apply risk management and improve the mortgage industry, combined with the government’s practice of merely issuing regulations to control their high-risk behavior, are key weaknesses in one of the most vital sectors of Nepal’s financial world. The real estate business occupies 75 percent of the capital market and has seen more than 50 percent of the total investment. However, it lies at the center of a financial mess from which the country has been trying to free itself. Nepali banks sank a lot of money in real estate for a lack of investment options, which triggered an artificial boom. When the bubble burst due to market saturation and new government regulations, prices plunged, leading to economic turmoil. When Nepal Rastra Bank (NRB) enforced a monetary policy and fixed a ceiling on real estate lending by banks to ease the crisis, it created a negative impact on the financial system putting all investments in a critical situation.
Posted on: Sat, 28 Jun 2014 02:16:48 +0000

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