Nepali commercial banks in mid-July 2025 collectively hold Rs. 600 billion in core capital and maintain a sector-wide CAR of 12.78%, well above regulatory norms. Large banks such as Global IME, Nabil, and NIMB lead in capital strength, while state-owned banks provide systemic stability. Mid-tier and smaller banks maintain solid liquidity and efficiency but face profitability pressures. The sector remains resilient but cautious, with rising NPLs, tighter spreads, and high CD ratios highlighting areas that need close monitoring.
As per the provisional report of Nepal Rastra Bank at the end of Asadh 2082 (Mid-July 2025), the core capital of commercial banks has reached Rs. 600 billion, while the total capital fund stands at Rs. 764 billion. This indicates that despite economic challenges, Nepali banks have maintained a relatively strong capital cushion. The sector-wide Capital Adequacy Ratio (CAR) is at 12.78%, above the regulatory threshold, while the Core Capital Adequacy Ratio (CCAR)remains at 10.03%, suggesting that while overall capital positions are adequate, there is limited room to absorb unexpected shocks.
In terms of individual banks, Global IME Bank (Rs. 56.04 billion), Nepal Investment Mega Bank (Rs. 51.78 billion), and Nabil Bank (Rs. 51.03 billion) are the top three in core capital, giving them stronger buffers to support their large loan portfolios. State-owned banks—Nepal Bank, Rastriya Banijya Bank, and Agriculture Development Bank—collectively hold over Rs. 87 billion in core capital, providing stability to the system, though their profitability and efficiency lag behind private-sector peers. Mid-tier institutions such as Kumari Bank, Prabhu Bank, and Laxmi Sunrise Bank also display healthy capital bases in the range of Rs. 30–37 billion, balancing between growth and prudential compliance. Smaller banks like Sanima, Nepal SBI, and Machhapuchhre operate with lower absolute capital but relatively stronger liquidity and risk management indicators, positioning them well in terms of stability.
The sector’s liquidity position remains stable, with total deposits at Rs. 6.54 trillion against total loans of Rs. 4.96 trillion, resulting in a Credit-to-Deposit (CD) ratio of 76.63%. This suggests that while lending has been aggressive, banks still maintain a buffer to manage liquidity shocks. Compliance with Nepal Rastra Bank’s prescribed lending requirements is also encouraging: commercial banks have allocated 13.66% to agriculture, 8.98% to energy, and 10.68% to MSME, meeting or exceeding regulatory minimums. However, profitability is under pressure as the average spread rate has narrowed to 3.66%, while non-performing loans (NPLs) have climbed to 4.44%. This underscores the need for stricter credit risk management, especially as banks expand into higher-risk sectors.
Overall, the commercial banking sector shows strong resilience in core capital and compliance, with large banks dominating capital strength, mid-sized banks maintaining balanced growth, and smaller banks focusing on efficiency. Yet, challenges remain in controlling rising NPLs, managing liquidity under tighter margins, and sustaining profitability in a competitive environment.
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