Statutory Liquidity Ratio (SLR) Status of Nepali Commercial Banks: Standard Chartered Leads the Pack

The latest data on the Statutory Liquidity Ratio (SLR) across major commercial banks in Nepal shows significant variation, highlighting different liquidity management strategies among institutions. SLR measures the percentage of a bank's net demand and time liabilities (NDTL) that must be maintained in the form of liquid assets like cash, gold, or government-approved securities before providing credit to customers.

At the top of the list, Standard Chartered Bank Nepal Limited holds the highest SLR at 39.19%, underlining its strong liquidity position and conservative asset management. Following closely are Rastriya Banijya Bank at 38.99%and Nepal SBI Bank Limited at 36.59%, both large and traditionally risk-averse banks.

On the other end of the spectrum, NMB Bank Limited reports the lowest SLR at 19.95%, signaling either an aggressive lending approach or tighter liquidity management. Citizens Bank International Limited (23.86%), Everest Bank Limited (24.45%), and Himalayan Bank Limited (24.79%) also maintain relatively lower SLRs compared to the industry average.

Major private sector giants like Nabil Bank Limited (24.85%) and NIC ASIA Bank Limited (25.36%) are keeping their SLR at moderately low levels, likely to support higher credit disbursement in the market, reflecting a bullish stance on loan growth and market expansion.

Interestingly, mid-tier banks such as Kumari Bank Limited (28.26%), Laxmi Sunrise Bank Limited (28.01%), and Global IME Bank Limited (28.48%) are clustered around the 28% mark, indicating a balanced approach between liquidity and credit expansion.

Agriculture Development Bank shows a healthy 30.45% SLR, while the oldest bank, Nepal Bank Limited, stands at 32.30%, reflecting their traditional risk-averse approach toward liquidity.

Meanwhile, Prabhu Bank Limited shows an SLR of 32.55%, slightly above the threshold of many private banks, suggesting relatively better liquidity buffers.

Key Takeaways:

• Highest SLR: Standard Chartered Bank Nepal Limited (39.19%)

• Lowest SLR: NMB Bank Limited (19.95%)

• Banks Above 30% SLR: Nepal Bank Limited, Rastriya Banijya Bank, Agriculture Development Bank, Nepal SBI Bank Limited, Prabhu Bank Limited

• Private Banks Aggressively Lending: NMB Bank, Citizens Bank, Everest Bank, Nabil Bank