LBEF RESEARCH JOURNAL OF SCIENCE, TECHNOLOGY AND MANAGEMENT

Author(s):Sushma Dahal, Prem Kumar Bhaskar

Abstract:Cost efficiency in banking industry is the major issue in the context of Nepal. As the banking system has negative impact of global crises and it is not easy to come over in such situation. The developing country Nepal can be more effected by a small issue. In such context, the efficiency and cost optimization have become essential for commercial banks. According to (Panta & Bedari, Cost Efficiency of Nepali Commercial Banks in the Context of Regulatory Changes, 2019) banks and Financial Institutions (banks) play the role of intermediary between saving and investment by allowing mobilization of saving from diverse sources to allocating them to more productive activities, ultimately benefitting the whole economy. This research paper tries to find out the determinants that really affect in achieving cost efficiency. Thus, by choosing only 2 banks in overall banking industry it tries to find out the reason behind cost inefficient. NPLTL, LLP, RWA, CAR and ROA has been taken as an indicator to analyze the cost efficiency.

Keywords:NPLTL, LLP, RWA, CAR and ROA.