Deposit at BFIs increases by 2.7% in four months

By A Staff Reporter,Kathmandu, Dec. 18:Deposit collections of the Banks and Financial Institutions (BFIs) have increased by 2.7 per cent in the first four months of the current fiscal year as compared to the same period last fiscal year.

According to the macroeconomic and financial report of the Nepal Rastra Bank, deposit collection at the BFIs has increased by Rs. 154.61 billion in the review period compared to an increase of Rs. 46.74 billion (0.9 per cent) in the corresponding period of the previous year. 

On the year-on-year (y-o-y) basis, the deposits at BFIs expanded by 14.3 per cent in mid-November 2023. 

The share of demand, saving and fixed deposits in total deposits stood at 6.1 per cent, 27.3 per cent and 60.2 per cent respectively in mid-November 2023. 

Such shares were 7.3 per cent, 26 per cent and 58 per cent respectively a year ago. The share of institutional deposits in total deposits of the BFIs stood at 36 per cent in mid-November 2023 against 37.1 per cent a year ago.

Similarly, private sector credit from the BFIs increased by Rs. 99.40 billion (2.1 per cent) in the review period compared to an increment of Rs. 68.55 billion (1.5 per cent) in the corresponding period of the previous year. 

On the y-o-y basis, credit to the private sector from BFIs increased by 4.4 per cent in mid-November 2023. 

The shares of private sector credit from BFIs to non-financial corporations and households stand at 63.1 per cent and 36.9 per cent respectively in mid-November 2023. 

In the review period, private sector credit from commercial banks, development banks and finance companies increased by 2.1 per cent, 1.8 per cent and 1.4 per cent respectively.

In the review period, out of the total outstanding credit of the BFIs, 12.1 per cent is against the collateral of current assets (such as agricultural and non-agricultural products) and 67.3 per cent against land and buildings. 

In the review period, outstanding loans of BFIs to the industrial production sector increased by 5.9 per cent, to the construction sector by 6.5 per cent, to the transportation, communication and public sectors by 4.4 per cent, to the wholesale and retail sector by 1.1 per cent, to service industry sector by 3.7 per cent and to the consumable sector by 2.5 per cent.

However, agriculture sector loans disbursed from BFIs decreased by 0.9 per cent in the review period. In the review period, term loans extended by BFIs increased by 8.7 per cent, cash credit loans by 13.9 per cent, trust receipt (import) loans by 18.4 per cent, real estate loans (including residential personal home loans) by 4 per cent and margin nature loan 6.4 per cent.

The overdraft loan decreased by 40.3 per cent (mainly due to the reclassification of the loans from the last year) and the hire purchase loan decreased by 19.1 per cent.