Nabil Bank Case Study

(DBL) were transferred to Emirates Bank International Ltd (EBIL), Dubai. Later EBIL sold its entire holding go National Bank Ltd, Bangladesh (NBLB). Hence 50% of equity shares of Nabil Bank Ltd are held by NBLB and out of remaining, financial institutions have taken 20% and 30% were issued to the general public of Nepal. Nabil bank was incorporated with the objective of extending international standard modern banking services to various sectors of the society. Pursuing its objective, Nabil provides a full range of commercial banking services across the nation and globe.

2.1.5 Concept of Credit Management

Credit is the amount of money lends by Creditor (bank) to the borrower (customer) either on the basis of security or without security. “Sum

They also deal with credit and credit instruments. To collect fund and mobilize them in a productive sector is a difficult task for any institutions. An investment of fund may be the question of life and death of the bank as there is various risk associated with it. Thus the banker must think seriously before making an investment decision. The investment policy of a bank consists of earning high returns on its un- loaned resources. But it has to keep in view the safety and liquidity of resources so as to meet the objectives of profitability which conflicts with each other and investment policy strikes a judicious balance among them. Therefore a bank should lay down its investment policy in such a manner so as to ensure the safety and liquidity of its funds and at the same time maximize its

Profitability

The Financial institution can maximize its volume of wealth through maximization of return on their investment and lending. So, they must invest their fund where they gain maximum profit. The profit of these companies mainly depends on the interest rate, the volume of a loan, its time period and nature of investment in different securities. iv. Liquidity

People deposit money at these companies with confidence that they will repay their money when they need it. To maintain such confidence of the depositors, the company must keep this point in mind while investing its excess fund in different securities or at a time of lending in different sectors so that it can meet the short-term obligation when they become due for payment.

v. Purpose of Loan

Why does a customer need a loan? This is a very the important question for any banker. If borrower misuses the loan granted by these companies they can never repay and company will pass heavy bad debts. Detailed information about the scheme of the project or activities should be examined before lending.

vi.