Prabhu Leads Deposit Rates as Average Bank Interest Rates Decline in Ashwin

Nepal’s 20 commercial banks have published their new interest rates for the month of Ashwin 2083, with the average deposit rates declining further from Bhadra amid continued excess liquidity in the banking system and subdued demand for credit.

The average maximum interest rate on individual fixed deposits has declined by 0.0465 percentage points to 4.0895% in Ashwin from 4.136% in Bhadra.

Similarly, the average interest rate on institutional deposits has fallen by 0.0145 percentage points, declining from 3.081% in Bhadra to 3.0665% in Ashwin.

The decline indicates that deposit rates continue to face downward pressure as banks maintain sufficient investable funds while credit demand has yet to show significant improvement.

Everest Bank has made the largest reduction in deposit interest rates for Ashwin. The bank has cut its individual deposit rate by 0.55 percentage points, bringing it down from 4.05% to 3.50%.

Its institutional deposit rate has also been reduced by 0.25 percentage points, from 3.50% to 3.25%.

Nabil Bank has reduced its individual deposit rate by 0.30 percentage points, from 4.55% in Bhadra to 4.25% in Ashwin. However, its institutional deposit rate remains unchanged at 3.01%.

Similarly, Standard Chartered Bank Nepal has lowered its individual deposit rate by 0.05 percentage points, from 3.80% to 3.75%.

Kumari Bank has reduced its individual deposit rate by 0.03 percentage points, bringing it down from 3.76% to 3.73%. Its institutional rate remains unchanged at 3.01%.

Citizens Bank has also reduced its institutional deposit rate from 3.00% to 2.75%, a decline of 0.25 percentage points, while its individual deposit rate remains unchanged at 3.85%.

While most rate changes have been downward, Sanima Bank has increased its institutional deposit rate by 0.21 percentage points, from 3.30% in Bhadra to 3.51% in Ashwin.

The bank has maintained its individual deposit rate at 4.50%. The remaining 15 commercial banks have kept their individual fixed deposit rates unchanged for Ashwin.

These include Agriculture Development Bank, Global IME Bank, Himalayan Bank, Laxmi Sunrise Bank, Machhapuchchhre Bank, Nepal Bank, Nepal Investment Mega Bank, Nepal SBI Bank, NIC Asia Bank, NMB Bank, Prabhu Bank, Prime Commercial Bank, Rastriya Banijya Bank, Sanima Bank, and Siddhartha Bank.

Among them, Prabhu Bank continues to offer the highest individual deposit interest rate at 4.55%. Machhapuchchhre Bank, Nepal Investment Mega Bank, NMB Bank, and Sanima Bank follow with rates of 4.50%.

The continued decline in deposit rates comes amid comfortable liquidity conditions in Nepal’s banking system. With banks holding sufficient investable funds and credit demand remaining relatively subdued, financial institutions have continued to adjust deposit rates downward.

The Ashwin rate structure shows that the downward movement is concentrated in selected banks, while most institutions have opted to maintain their existing individual deposit rates. Overall, the decline in average rates suggests that liquidity conditions remain comfortable and banks continue to face limited pressure to raise the cost of deposits.