Nepali Banks Lower Fixed Deposit Rates for Ashar Amid Ample Liquidity
In Ashar 2082, several Nepali banks have reduced their fixed deposit rates for individuals, bringing the average rate down to 5.90%. While some banks maintained last month’s rates, five major banks opted for cuts amidst high liquidity and sluggish credit demand.
Amid continued excess liquidity in the financial system, several commercial banks in Nepal have reduced their fixed deposit interest rates for individual depositors for the Nepali month of Ashar 2082. Data reveals that the average maximum fixed deposit rate has slipped to 5.90%, down from 5.95% in Jestha, marking a 0.05 percentage point decline.
Out of the listed banks, five major institutions made rate adjustments this month:
Everest Bank decreased its rate by 0.09 percentage points to 6.55%
NIC Asia Bank slightly reduced it to 6.55%, from 6.60%
NMB Bank saw one of the sharper drops, bringing its rate down to 6.00% from 6.60%
Agricultural Development Bank trimmed rates by 0.06 points to 5.45%
Nepal Bank followed the same trend, cutting its rate by 0.05 points to 5.45%
Meanwhile, 14 other commercial banks, including big players like Nabil Bank, Standard Chartered, and Global IME, maintained their previous interest rates from Jestha. None of the banks have increased rates this month, continuing a downward trajectory that has persisted for nearly a year and a half.
Despite the lower interest environment, credit growth remains stagnant. Bankers attribute this to policy bottlenecks and subdued demand from the private sector. Nonetheless, the consistent rate cuts are expected to ease borrowing costs, improve lending conditions, and potentially stimulate investment activities if structural reforms follow.
With the base rate likely to fall further, market watchers expect the trend of declining loan interest rates to continue in the coming months.
