October 18: Deposits of commercial banks increased by Rs 8.18 billion within a week after the Dashain festival. The Nepal Bankers Association informed that the money withdrawn from the banks before Dashain have started returning back to the banking system.

According to the association, between October 1 and 7, deposits of commercial banks had decreased by Rs 7.99 billion and stood at Rs 4510 billion. However, bank deposits increased again to Rs 4519 billion between October 8 to 14. The deposits of commercial banks increased by Rs 8.18 billion in the review week. During the same period, credit flow of banks increased by just Rs 62 million.

According to the association, the loan disbursement of banks increased from Rs 41926 billion to Rs 4193.2 billion as of October 14.

Nepal Rastra Bank (NRB) had exchanged new notes for old ones worth Rs 16 billion for Dashain. Apart from this, new notes worth Rs 40 billion were sent to the market, according to a statement issued by NRB. The central bank says that the cash that went to the market will gradually return to the banking system through deposits.

On October 14, the average credit-to-deposit (CD) ratio of banks stood at 86.96 percent. According to the instructions of the NRB, banks should maintain the CD ratio within 90 percent.