Commercial Bank increases it shares in margin loan; BFIs invest Rs 25 arba in margin lending

As per the report of the Nepal Rastra Bank (NRB), the Banks and Financial Institutions (BFI) have invested Rs 25 arba in margin lending till Ashoj, 2072. The NRB defines margin lending as loans offered against publicly listed and traded securities as collateral. Compared to the Bhadra the investment in margin lending has increased by 3%. Till the month of Bhadra the BFIs had an investment of Rs 24.25 arba. Though the investment in margin lending has increased still out of total loan dispersed, margin lending accounts only for 1.8% of the loan. As the liquidity in Banks and financial institutions have increased, even commercial banks has increased issuing loan under the heading margin lending. Out of total margin loan provided by all financial institutions in past three months, 67% of this kind of loan is issued by commercial banks. Earlier bikas bank and finance had more investment in margin lending. The size of margin lending among commercial bank has increased by 1.51% as compared to the Ashoj 2071. Out of 30 commercial banks, only 26 commercial banks have been providing such types of loan. Nabil Bank, Standard Chartered, Nepal SBI and Agriculture Development Bank do not provide such types of loan. In the first quarter of this fiscal year, the margin lending of Nepal investment Bank Limited (NIBL) has increased. NIBL has increased such loan by 8 times to Rs 50 crore. However, in terms of amount NIC Asia has the highest investment in margin lending out of all commercial banks. It has an investment of Rs 3.34 arba. Source: Aarthik Aviyan