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Financial sector is a mainstay of an economy and is significantly linked with economic growth of the country. Development of financial sector boost up economic growth by increasing capital accumulation and rate of technological progress, however, it reduces poverty by extending access of financial services to the poor. Moreover, financial stability relies heavily on the strength of financial sector along with other factors. The disruption in the financial sector is caused by information asymmetries, regulatory failures, asset liability mismatch, excessive leverage and herd behavior of investors, which ultimately leads to the financial crisis.