From July to March of the current financial year, an additional 34 billion 283 million shares were loaned, NEPSE around 2500 to 2700 points.
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In the nine months of the current financial year, banks and financial institutions have provided an additional 34 billion 283 million rupees in share loans. Compared to the same period of last financial year, this share loan is 37.8 percent more. The share market has not increased in proportion to the increase in share loans.
Equity loans have been increasing since the beginning of the current financial year. According to Rashtra Bank data, from last July to March, share loans between 25 and 50 lakhs have increased by 15.14 percent and loans below 25 lakh rupees have increased by 8.6 percent. In the same period, loans of more than 1 crore rupees increased by 51.4 percent and loans between 5 million to 1 crore rupees increased by 19.4 percent, according to the monthly report of Rashtra Bank.
In the nine months of the last financial year, the growth rate of share loans was 13 percent. By March 2081, loans of less than 2.5 million had increased by 4.9 percent, loans between 25 to 50 million rupees by 11 percent and loans between 5 million to 10 million rupees by 2 percent. According to the data of Rashtra Bank, loans above 1 crore increased by 17.7 percent during that period.
According to the data of the current financial year, the growth rate of loans of large amounts is more than that of small amounts. At present, the National Bank has imposed a limit of 150 million on share loans for individual investors, while this limit has been removed for institutional investors. According to the experts, there was no positive impact on the stock market because the big investors used the loan taken on the share mortgage elsewhere.
Investors are more likely to use share loans elsewhere, said Bharat Ranabhat, the former president of Nepal Stock Brokers Association. In banks and financial institutions, margin loans are available on share securities. Although it is commonly called margin lending, that loan is of a different nature," he said. It may have been used elsewhere.'
Now, banks and financial institutions are more excited to provide loans on share mortgages rather than real estate, so margin loans may increase, he said. "Actually, the bank and the Rashtra Bank do not have accurate data on where that loan has been used, so the stock market has not increased as the loan has increased," he said. For this reason, the official said that they have been demanding that brokers can give margin loans so that the loan taken on the share mortgage can be invested in the purchase of shares.
Another ex-chairman of the Stock Brokers Association said that the positive effect of the increase in loans was not seen in the NEPSE index because more money than the amount of money that came in the name of share loans was taken out of the stock market through share sales and capital tax. "In recent months, it seems that share loans have increased, so the demand for shares in the market should increase, but that is not seen," said the official, "as the demand for shares has not increased as the loan has increased, the overall NEP has not increased as expected."
There has been more liquidity in the financial system since the last financial year. The interest rate has continuously decreased and is the lowest in 46 months, while the loan demand is very low.
That's why now banks are asking share investors to take loans. National Bank data shows that even small investors have taken loans from banks. However, stockbrokers say that investors are confused as to why the market could not grow.
is an increase in investor confidence through positive signals (news) needed to increase the market. Looking at the nature of transactions in the stock market in recent days, it seems that investment has increased. But investors have seen no signs of positive hope in the long-running declining market. Even though the government formed after the coalition of Congress and UML gave priority to economic development, the expected improvement in the economy has not been achieved. Experts say that due to the lack of improvement in other sectors of the economy, investors' confidence has not increased in the stock market.
Congress and UML agreed to form a new government on June 17. However, the stock market had started to rise in the previous few weeks. After the government was formed by the big parties, the stock market started to rise. According to which, Nepse, which was around 2,000 in the last week of June, reached 3,000 at the end of July. That high point was short-lived, and the stock market began a downward trend again. As a result, the NEPSE index fell below 2500. After that NEPSE is around 2500 to 2700 most of the time. Most of the days since then, NEPSE has decreased and even if it has increased, the growth rate is low.
