Deposits vs Loans – Which Banks Are Managing Liquidity Well?

Managing liquidity is at the heart of banking stability, and the balance between deposits and loans shows how efficiently banks deploy their resources while keeping buffers for risk. As of mid-July 2025 (Asadh end 2082), the entire Nepali commercial banking sector holds Rs. 6.54 trillion in deposits against Rs. 4.96 trillion in loans, resulting in a sector-wide CD ratio of 76.63%. This figure suggests that banks are lending around three-fourths of their deposits, a moderate but watchful level. However, individual banks show significant variation, reflecting different risk appetites and business models.

The state-owned banks—Rastriya Banijya Bank (RBB), Nepal Bank Limited (NBL), and Agriculture Development Bank (ADBL)—are clearly more conservative in their liquidity management. RBB maintains the lowest CD ratio at 62.27%, while NBL (71.10%) and ADBL (72.82%) also stay on the safer side. Their strategy emphasizes financial resilience over profitability, ensuring large liquidity buffers for deposit withdrawals or market shocks. Similarly, Standard Chartered Bank Nepal, with a CD ratio of just 70.50%, and the highest net liquidity at 46.33%, demonstrates a highly cautious approach that prioritizes stability above aggressive loan growth.

By contrast, private banks dominate the high CD ratio group, reflecting aggressive lending practices. Citizens Bank International (84.45%), NMB Bank (84.31%), and Prime Commercial Bank (83.37%) are the most aggressive lenders, deploying over four-fifths of their deposits into loans. While such strategies maximize interest income, they also increase liquidity risk if deposits decline. Other big names like Nabil Bank (82.48%), Himalayan Bank (81.34%), and Sanima Bank (81.03%) also run on leaner liquidity buffers, signaling confidence in their ability to retain deposit flows.

Meanwhile, mid-range banks such as Global IME (76.06%), NIC Asia (76.72%), and Everest Bank (77.44%) strike a more balanced approach, operating near the sector average. These banks aim to maintain profitability through lending while keeping reasonable liquidity cushions.