Banks' Investment in Securities Soars by 21.46% in Third Quarter of 2081/82

Nepal’s banking sector has demonstrated a significant surge in investment on securities during the third quarter of fiscal year 2081/82. The total investment across commercial banks climbed by 21.46%, reaching Rs. 1.30 trillion (Rs. 1,300,660,122 thousand), compared to Rs. 1.07 trillion (Rs. 1,070,813,645 thousand) during the same period last year. This sharp increase reflects a strategic move by banks to strengthen their portfolios with safer and more stable investments amid an uncertain economic landscape.

Top Performers this quarter include Rastriya Banijya Bank Limited (RBBL), which recorded an exceptional 77.52%growth. Its investment rose from Rs. 76.57 billion to Rs. 135.93 billion, making it the top player in securities investment. Prabhu Bank Limited (PRVU) wasn’t far behind, posting a 72.83% increase, with its portfolio swelling to Rs. 103.77 billion. Similarly, Kumari Bank Limited (KBL) achieved a strong 68.64% growth, reflecting a highly aggressive investment approach in government bonds and other secured instruments.

Among the moderate gainers, Nepal Investment Mega Bank (NIMB) and Global IME Bank (GBIME) posted growths of 47.88% and 30.78%, respectively, showcasing a balanced but confident investment strategy. Nabil Bank also strengthened its securities holding with a 30.16% rise, maintaining its position among the country's most active institutional investors.

Some banks, however, posted minor growth or near-flat performance. For example, Nepal Bank Limited (NBL) showed a minimal 1.63% rise, while Century Commercial Bank (CZBIL) barely moved the needle with a 0.17% uptick. Likewise, Everest Bank Limited (EBL) and Siddhartha Bank Limited (SBL) managed modest gains of 6.05% and 8.61%, respectively, indicating a conservative approach focused more on liquidity preservation rather than aggressive expansion.

Not every bank shared in the sector’s overall growth. A few notable decliners were observed, with SBI Bank's investment falling by 20.21%, and Sanima Bank dropping even more sharply by 20.50%. Himalayan Bank Limited (HBL) reduced its securities exposure by 7.16%, while Standard Chartered Bank Nepal (SCB) saw a slight dip of 2.52%. The steepest fall came from NMB Bank, which slashed its securities investment by a whopping 54.70%, signaling a major strategic repositioning or liquidity pressure.

Key takeaways from the data show that most banks are prioritizing safer investment options such as government securities over risky lending amidst a sluggish credit demand and macroeconomic uncertainties. However, the decline in investment by a few major players suggests that liquidity management challenges and changing risk appetites are playing out differently across the banking industry.