Commercial banks reduce interest rate by 0.04 percentage point for next month
Summary
Commercial banks in Nepal have lowered deposit interest rates by an average of 0.04 percentage points for the next month, continuing a downward trend driven by excess liquidity. Nepal Rastra Bank’s efforts to mop up liquidity have not stopped the slide, while the credit-deposit ratio has fallen to 71.48 percent.
Key Points
- Commercial banks in Nepal have cut deposit interest rates by an average of 0.04 percentage points for the one-month period starting Thursday.
- The average rate for individual fixed deposits now stands at 4.08 percent, down from 4.13 percent last month and 4.16 percent in the previous month.
- Four banks — Nabil Bank, Everest Bank, Standard Chartered Bank and Kumari Bank — reduced their rates, while sixteen kept them unchanged.
- Excess liquidity and weak credit disbursement are pushing rates lower despite Nepal Rastra Bank’s efforts to withdraw funds from the banking system.
