April 3: Bank deposits increased by Rs 10 billion on Friday, according to the latest report of Nepal Rasttra Bank (NRB) released on Sunday.
According to the central bank, the total deposits with banks stood at Rs 5415 billion as of March 30, which increased to Rs 5425 billion on March 31.
NRB spokesperson Dr. Gunakar Bhatta said that although the deposit collection in the banking system seems positive, such a huge difference in a single day is caused due to the deposit of large sum.
“Lately, the rate of deposit is on a consistent rise. The spike in graph of Friday was caused by the deposit of large sum on the same day,” he said.
Earlier, on March 15, NRB released the data stating that the bank deposits decreased by Rs 11 billion in a single day.
Bank deposits have been continuously rising since March 15.
According to NRB, deposits with commercial banks stood at Rs 4773 billion as of mid-March, which reached Rs 4785 billion on March 31. Deposits of development banks and finance companies have remained stable. By mid-March, there were deposits of Rs 640 billion in development banks and finance companies.
With the increase in deposits, banks have started providing small loan as wells. The total credit flow of banks was Rs 4515 billion as of last Thursday which reached Rs 4785 billion on Friday. During this period, the total loans of commercial banks increased by Rs 100 billion to Rs 4276 billion.
Along with the increase in deposits, the credit-deposit ratio (CD ratio) of banks and financial institutions has decreased. On Thursday, the CD ratio of banks was 85.66 percent, but on Friday, it stood at 85.54 percent percent. By mid-March, the CD ratio of banks was 85.60 percent. According to the instructions of NRB, banks should maintain a CD ratio of less than 90 percent.
Despite the decline in CD ratio, there has been a general increase in the interbank interest rate. The interbank interest rate which was 7.01 percent on Thursday increased to 7.02 percent on Friday. Officials say that the possibility of increasing deposits will continue in the coming days. It is expected that the economy will improve as deposits in the banking system increase.
