Business Contraction in Eight Commercial Banks

Banking Khabar/ In the first month (Shrawan) of the current fiscal year 2081/82, the business of eight out of the 20 commercial banks contracted. Banks such as Himalayan Bank, Laxmi Sunrise Bank, Nepal Bank Limited, NIC Asia Bank, among others, saw a reduction in their business activities.

Similarly, Prabhu Bank, Rastriya Banijya Bank, and Agricultural Development Bank also experienced a decline in their investments during Shrawan. NIC Asia Bank alone saw its investment shrink by NPR 10.78 billion. Agricultural Development Bank’s business contracted by NPR 2.47 billion, and Himalayan Bank’s business decreased by NPR 4.64 billion.

On the other hand, Nepal Investment Mega Bank saw the highest business expansion during Shrawan, increasing its investment by NPR 8.68 billion. Global IME Bank’s investment grew by NPR 5.84 billion, while Nabil Bank’s business increased by NPR 710 million.

Overall, the loan investment by commercial banks increased by only NPR 2.25 billion. After a long period, interest rates have finally dropped to a single digit, and banks have ample investable funds. However, the expected expansion in investment has not yet materialised, with the average Credit-Deposit (CD) ratio of banks falling to 79%.