Commercial banks in Nepal have announced their interest rates for the month of Asar (mid-June to mid-July), with seven banks reducing deposit rates while 13 others have retained the rates applicable in the previous month of Jestha (mid-May to mid-June).
Among the country’s 20 commercial banks, the institutions that have lowered interest rates are:
- NIC Asia Bank;
- Standard Chartered Bank Nepal;
- Kumari Bank;
- Himalayan Bank;
- Prime Commercial Bank;
- Laxmi Sunrise Bank; and
- NMB Bank.
The remaining 13 commercial banks have kept their interest rates unchanged.
Individual Fixed Deposit Rates Decline
According to the newly published rates, the average maximum interest rate offered on individual fixed deposits has fallen to 4.27 percent in Asar, down from 4.34 percent in Jestha.
Institutional Deposit Rates Also Edge Lower
Interest rates on institutional fixed deposits have also witnessed a slight decline. The average rate has dropped by 0.02 percentage points, from 3.20 percent in Jestha to 3.18 percent in Asar.
Excess Liquidity Continues to Pressure Rates
The continued decline in deposit rates reflects the abundance of loanable funds in the banking system and weak credit demand. With banks holding excess liquidity, competition for deposits has eased, prompting many institutions to lower returns offered to savers.
The latest adjustments indicate that Nepal’s interest rate environment remains on a downward trajectory, with banks seeking to balance deposit mobilization and lending activities amid subdued private-sector credit growth.
