Central bank declares Crystal Finance crisis-ridden

The central bank today declared Crystal Finance Company ‘crisis-ridden’.

The board meeting of the central bank today evening was forced to take the decision as the finance company’s financial health deteriorated due to inside lending. The financial institutions’ had to make provisioning of the loans that went to its promoters, , according to the central bank’s direction, making it financially weak.

According to the central bank, the Crystal Finance has lent Rs 379.33 million to construction sector, Rs 32 million accounts for consumer loans and its total lending stood at Rs 918.12 million, whereas it has mobilised a deposit worth Rs 605 million.

The finance company has also failed to increase its paid-up capital proportionally according to the central bank’s directives. It has to increase its paid up capital to Rs 200 million by mid-July 2013. Its paid-up capital stood at Rs 70 million.

Likewise, the central bank board has also revised merger bylaws. According to the revised merger bylaw public and private financial institutions can also merge, It will make the merger of wholly government-owned Rastriya Banijya Bank and listed NIDC Development Bank’s merger possible.