#NepalBanking #CapitalAdequacy
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By Sandeep Chaudhary

Which Banks Have the Highest Capital Adequacy Ratio (CAR) in Nepal?

Which Banks Have the Highest Capital Adequacy Ratio (CAR) in Nepal?

As per Nepal Rastra Bank’s provisional indicators for Asadh end 2082 (mid-July 2025), Nepal’s commercial banking sector maintains an overall Capital Adequacy Ratio (CAR) of 12.78% and a Core Capital Adequacy Ratio (CCAR) of 10.03%, both above the minimum regulatory threshold. This shows that the sector is broadly well-capitalized, though with significant differences across banks. At the top, Standard Chartered Bank Nepal Limited stands out with the strongest capital buffer at 17.82%, well above the industry average, reflecting its conservative lending approach and high-quality asset portfolio. Close behind are Prabhu Bank Limited (13.90%), Nepal Investment Mega Bank Limited (13.73%), NIC Asia Bank Limited (13.42%), and Agriculture Development Bank Limited (13.36%), each comfortably maintaining strong solvency levels. These banks not only meet regulatory requirements but also provide additional cushions against credit shocks.

Mid-range performers such as Nabil Bank (11.94%), Global IME Bank (12.97%), and NMB Bank (12.03%) sit around the sectoral average, striking a balance between aggressive lending and maintaining capital reserves. State-owned giants—Nepal Bank Limited (13.06%) and Rastriya Banijya Bank (11.84%)—continue to provide systemic stability, though their efficiency and profitability lag slightly compared to dynamic private banks. On the other hand, banks like Himalayan Bank (11.16%) and Siddhartha Bank (11.77%) are closer to the minimum range, highlighting thinner margins of safety.

The sector’s aggregate deposit base reached Rs. 6.54 trillion, while total loans stood at Rs. 4.96 trillion, leading to a CD ratio of 76.63%. Liquidity indicators remain stable overall, though some banks like Citizens Bank (84.45%) and NMB (84.31%) show higher CD ratios, indicating more aggressive lending practices. Meanwhile, profitability pressures are evident, with spread rates narrowing to 3.66% and non-performing loans (NPLs) rising to an average of 4.44%, though banks such as Everest Bank demonstrate exceptional asset quality with only 0.38% NPLs.

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