Banks told to cut rates

Kathmandu, Dec. 23 Finance Minister Barsha Man Pun on Friday asked commercial banks to reduce rates of interest and diversify their investments. Addressing an interaction with the bankers at the ministry today, Minister Pun told the Chief Executive Officers (CEOs) of different commercial banks to diversify their investments. Pun urged CEOs of various commercial banks and financial institutions to reduce the lending interest rate. The FM’s request came at a time when the interest rates at various banks are higher despite the excess of liquidity. "Banks should now focus their investments on agriculture, infrastructure development and service sectors," Minister Pun said. Representatives from several banks attended the programme where a wide range of issues, including the ones concerning a difficult labour relation were discussed. At the meeting, the bankers requested the government to deal with the issues related to trade unions in order to attract more investments to the country’s industrial sector. Similarly, the bankers had said that there was no any liquidity problem with them. However, they maintained that they were facing problems in investment due to various reasons.  Stating that the industrial sector was facing problems due to the hurdles raised by the workers, they stressed the need of solving those problems and simplifying the administrative rules. During the meeting, Nepal Rastra Bank Governor Dr. Yubraj Khatiwada asked the bankers to take measures to expand their services to bring more and more people within the purview of banking service. Earlier, Prime Minister Dr. Baburam Bhattarai had also expressed his concern over the increasing rate of interest in loans despite high flow of liquidity.