MGT604 Assignment 1 Solution Spring 2017

Real Time Dilemma: Recently ‘Review of sectors’ is released by State Bank of Pakistan. Among many other highlights, non-banking financial institutions (NBFI) performance is matter of grave concern as earning of NBFIs is declining in spite of assets expansion in current fiscal year. NBFIs involves in non-banking services these are: asset management, Modarbas, leasing, housing finance, venture capital investment. It is highlighted that growth of NBFIs remained 7% which is at very modest momentum. Assets size of NBFIs at end of year 2015 was 738 billion rupees but this expansion in balance sheet did not translate into earning growth.

Question: As a student of Management of Financial Institutions, you are required to pose your discussion on factor responsible for such dramatic situation. (10 Marks)