Deposits at BFIs increase by 5.7%

By A Staff Reporter,Kathmandu, May 15: Deposits at Banks and Financial Institutions (BFIs) increased by 5.7 per cent in the first nine months of the current fiscal year.

According to current macroeconomic and financial report of Nepal Rastra Bank (NRB), the deposits collection of BFIs increased by 368.47 billion (5.7 per cent) during the review period as compared to same period last fiscal year.

The deposits at BFIs increased by Rs. 409.04 billion (7.2 per cent) in the corresponding period of the previous year. 

On y-o-y basis, deposits at BFIs expanded by 11.5 per cent in mid-April 2025.

The share of demand, saving and fixed deposits in total deposits stood at 5.7 per cent, 35.8 per cent and 51.0 per cent respectively in mid-April 2025. 

Such shares were 5.2 per cent, 29.1 per cent, and 58.9 per cent respectively a year ago.

The share of institutional deposits in total deposits of BFIs stood at 35.4 per cent in mid-April 2025. Such a share was 35.7 per cent a year ago.

Similarly, the private sector credit from BFIs increased by Rs. 361.03 billion (7.1 per cent) in the review period compared to an increase of Rs. 222.21 billion (4.6 per cent) in the corresponding period of previous year. 

On y-o-y basis, credit to the private sector from BFIs increased by 8.3 per cent in mid-April 2025.

The shares of private sector credit from BFIs to non-financial corporation and households stand at 63.4 per cent and 36.6 per cent respectively in mid-April 2025. 

Such shares were 62.7 per cent and 37.3 per cent a year ago.

In the review period, private sector credit from commercial banks, development banks and finance companies increased by 7.4 per cent, 4.6 per cent and 6.4 per cent respectively.

Out of the total outstanding credit of the BFIs as of mid-April 2025, 14.6 per cent is against the collateral of current assets (such as agricultural and non-agricultural products) and 65.2 per cent against land and building. 

Such ratios were 11.4 per cent and 67.6 per cent respectively a year ago.

In the review period, outstanding loan of BFIs to the industrial production sector increased by 9.6 per cent, construction sector by 11.4 per cent, wholesaler and retailer sector by 5.2 per cent, transportation, communications and public services sector by 10.2 per cent, service industries sector by 8.6 per cent and consumable sector by 8.3 per cent.

In the review period, term loan extended by BFIs increased by 4.9 per cent, margin nature loan by 37.8 per cent, trust receipt (import) loan by 60.6 per cent, hire purchase loan by 4.1 per cent, cash credit loan by 5.2 per cent and real estate loan (including residential personal home loan) by 4.9 per cent. 

However, the overdraft loan disbursed by BFIs decreased by 12.1 per cent during the review period.

NRB absorbs liquidity of Rs. 17,186 billion

In the first nine months of the current fiscal year, NRB absorbed, on transaction basis, a total liquidity of Rs. 17,186.15 billion through various instruments of monetary operation.

Of the total absorbed liquidity, Rs. 2212.05 billion was absorbed through deposit collection auction and Rs. 14,974.1 billion through Standing Deposit Facility (SDF) whereas Overnight Liquidity Facility of Rs. 2.7 billion was utilised. 

In the corresponding period of the previous year, Rs. 766.19 billion net amount of liquidity was absorbed through various instruments of monetary operations.

In the review period, NRB injected liquidity of Rs. 484.71 billion through the net purchase of USD 3.63 billion from foreign exchange market. 

Liquidity of Rs. 566.55 billion was injected through the net purchase of USD 4.26 billion in the corresponding period of the previous year.

The NRB purchased Indian currency (INR) equivalent to Rs. 386.81 billion through the sale of USD 2.84 billion in the review period. 

According to the NRB, INR equivalent to Rs. 366.99 billion was purchased through the sale of USD 2.76 billion in the corresponding period of previous year.