Need to focus on quality of credit than on size: Former FM Khatiwada

Kathmandu / Jan 8: Former Finance Minister and Governor Dr. Yuba Raj Khatiwada has viewed that banks and financial institutions should opt to improve the quality of credit rather than its size.

Addressing the Confederation of Bank and Financial Institutions, Khatiwada said that agriculture sector has not been able to take advantage of rise in the size of capital of the banks as hydro sector is doing.

He also mentioned that size of credit is closer to the economy. The rising amount of the credit indicating financial system is the verge of risk.

He mentioned that capital fund of bank and financial institutions jumped up by the 8 times in the last decade.

Capitalization of banks of Nepal increase along in South Asia as assets of the banks increase due to rise in the capital of the banks.

The capital assets of the banks touched 123 per cent of the size of the gross domestic product in the last year which lets Nepal ranks at the 23th spot among 140 countries in term of total capital size.