They said since BFIs fall under the category of sensitive sectors, negative news could lead to erosion of confidence among depositors, further deepening the problems in the sector. [break]
"Our observation is that publishing or broadcasting of immature data create trouble for banks and financial institutions. We appeal to the media to show some restraint while covering such news," said Rajendra Man Shakya, the president of Nepal Finance Companies´ Association (NFCA).
Once people read such news, Shakya argued, it would be very difficult for the financial institutions to regain public trust. "Once negative impression is built against an institution, people simply refuse to trust it again," he stated.
Former president of the association, Ram Shanta Shrestha asked the media people to act responsibly when they sense some news could create trouble. "We request media persons to bear in mind the sensitivity of this sector and the impact some news can have on it," he added.
Officials said that the random manner in which the central bank has been issuing licenses was one of the major reasons for lack of corporate governance in some institutions.
They further said that ´quick´ and ´different´ decisions of regulatory bodies were also creating confusion amongst BFIs.
Media persons, on the other hand, attributed the flow of negative news to the weak information system of finance companies. They asked BFI officials to provide information through website, and also appoint communication officers for the media to deal with directly.
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