You are here -allRefer - Reference - Country Study & Country Guide - Bhutan >

allRefer Reference and Encyclopedia Resource

allRefer    
allRefer
   


-- Country Study & Guide --     

 

Bhutan

 
Country Guide
Afghanistan
Albania
Algeria
Angola
Armenia
Austria
Azerbaijan
Bahrain
Bangladesh
Belarus
Belize
Bhutan
Bolivia
Brazil
Bulgaria
Cambodia
Chad
Chile
China
Colombia
Caribbean Islands
Comoros
Cyprus
Czechoslovakia
Dominican Republic
Ecuador
Egypt
El Salvador
Estonia
Ethiopia
Finland
Georgia
Germany
Germany (East)
Ghana
Guyana
Haiti
Honduras
Hungary
India
Indonesia
Iran
Iraq
Israel
Cote d'Ivoire
Japan
Jordan
Kazakhstan
Kuwait
Kyrgyzstan
Latvia
Laos
Lebanon
Libya
Lithuania
Macau
Madagascar
Maldives
Mauritania
Mauritius
Mexico
Moldova
Mongolia
Nepal
Nicaragua
Nigeria
North Korea
Oman
Pakistan
Panama
Paraguay
Peru
Philippines
Poland
Portugal
Qatar
Romania
Russia
Saudi Arabia
Seychelles
Singapore
Somalia
South Africa
South Korea
Soviet Union [USSR]
Spain
Sri Lanka
Sudan
Syria
Tajikistan
Thailand
Turkmenistan
Turkey
Uganda
United Arab Emirates
Uruguay
Uzbekistan
Venezuela
Vietnam
Yugoslavia
Zaire

Bhutan

Banking and Credit

The Royal Monetary Authority, since its establishment in 1982, has served as the central bank of Bhutan and maintained its headquarters in Thimphu. The authority was responsible for issuing currency, implementing monetary policy, coordinating financial institution activities, and holding the government's foreignexchange earnings. Among its initial duties was the administration of financial assistance to rural development, a duty later delegated to the Bhutan Development Finance Corporation when it was founded in 1988.

The Bank of Bhutan, the nation's commercial bank, was established in 1968 as a joint venture with the Chartered Bank of India, which owned 25 percent of the bank. In 1970 the State Bank of India took over the Bhutanese assets controlled by the Chartered Bank of India. Since its establishment, the Bank of Bhutan's board of directors, has been composed of key officials from the economic ministries and departments and two officials from the Indian banks. The bank was restructured in 1971. To ensure that it would have sufficient funds at its disposal, government departments were required to deposit all of their accounts with the government-run bank until 1982, when the Royal Monetary Authority was established. Since 1982 the Bank of Bhutan has served as the retail banking agent for the Royal Monetary Authority. The bank's principal office was in Phuntsholing; in 1991 there were twenty-six branch offices throughout the country. The Bank of Bhutan was able to give relatively large loans for capital programs, such as irrigation projects in the south-central region. Among its retail banking activities was the issuance of rupee-denomination travelers' cheques; this activity was started in 1974.

The Bhutan Development Finance Corporation, upon its establishment in 1988, took over the administration of rural financial assistance from the Royal Monetary Authority. Loans were granted for improving farmlands, acquiring livestock, and meeting short-term, seasonal requirements. At least some of the funding for the corporation came from the Asian Development Bank, including an initial US$2.5 million loan in 1988 for the expansion of small- and medium-sized, private-sector industrial development. By 1991 the corporation had been privatized.

Nonbank financial institutions also were set up as part of the economic modernization process. Insurance was offered by the Royal Insurance Corporation of Bhutan, which was established in 1975 with its headquarters in Phuntsholing. Starting in 1980, individuals could invest their savings in the newly established Unit Trust of Bhutan. The trust, with its main office in Phuntsholing, channeled invested funds, for which it issued shares called units, into industrial and commercial development. The Government Employees' Provident Fund, established in 1986; the Bhutan Development Finance Corporation; and other nonbank institutions were small and constrained by the rudimentary use of money in the economy.

Data as of September 1991

Bhutan - TABLE OF CONTENTS

  • THE ECONOMY, BHUTAN


  • Go Up - Top of Page

    Make allRefer Reference your HomepageAdd allRefer Reference to your FavoritesGo to Top of PagePrint this PageSend this Page to a Friend


    Information Courtesy: The Library of Congress - Country Studies


    Content on this web site is provided for informational purposes only. We accept no responsibility for any loss, injury or inconvenience sustained by any person resulting from information published on this site. We encourage you to verify any critical information with the relevant authorities.

     

     

     
     


    About Us | Contact Us | Terms of Use | Privacy | Links Directory
    Link to allRefer | Add allRefer Search to your site

    allRefer
    All Rights reserved. Site best viewed in 800 x 600 resolution.