The NEPSE Journal
Market commentary, data deep-dives, and trading notes from the NEPSE Trading desk.
Nepal’s banking sector’s general reserves surged by Rs. 100.7 billion (17.1%) to Rs. 690.4 billion in August 2025, boosting the financial system’s capital strength and stability amid cautious credit conditions.
Nepal’s financial institutions increased their liquid funds by 25.4 percent year-on-year to Rs. 723.24 billion in August 2025, largely due to higher balances with NRB and foreign holdings abroad, signaling improved liquidity and cautious financial management.
Fixed deposits in Nepal dropped by 5.3 percent year-on-year to Rs. 3.48 trillion, reflecting a growing shift among depositors toward short-term savings and liquid instruments due to lower interest rates and economic uncertainty.
Saving deposits in Nepal’s banking sector surged 39 percent year-on-year to Rs. 2.70 trillion, driven by higher household participation, remittance inflows, and the rise of digital banking channels.
Private sector loans in Nepal rose 7.7% year-on-year to Rs. 5.6 trillion in mid-August 2025, driven by rising corporate and household borrowing amid improved liquidity and business confidence.
Nepal’s bank deposits grew 12.5% year-on-year to Rs. 7.2 trillion in August 2025, led by a sharp rise in savings and call deposits, while fixed deposits declined due to changing liquidity preferences.
Foreign liabilities of Nepal’s financial institutions rose by 4.5% to Rs. 34.7 billion in August 2025, reflecting renewed external borrowing to manage liquidity but also raising long-term currency risk concerns.
Loans and advances by Nepal’s financial institutions reached Rs. 7.06 trillion in mid-August 2025, growing only marginally as cautious lending and slow private investment kept credit expansion modest.
Call deposits rose 8.8 percent to Rs. 566 billion in mid-August 2025, driven by higher residential deposits and improved liquidity across banks and financial institutions.
General reserves of Nepal’s financial institutions surged by 11.9% in the past year, reaching Rs. 690.4 billion. The growth underscores capital strengthening and risk preparedness amid a cautious lending environment.