Six banks have bad debts of more than four percent
KATHMANDU, Nov 6: Bad debts of Nepal’s commercial banks surged more than double in the first three months of the current fiscal year, thanks to the non-recovery of the issued loans caused by ongoing economic slowdown.
The financial reports unveiled by the banks show that their cumulative amount in bad debt increased 103.53 percent during mid-July and mid-October, compared to the ratio in the same period last year. According to the quarterly reports, the average bad debt of ‘A’ class banks stood at 3.39 percent in the review period, compared to 1.66 percent a year ago.
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Of the 20 commercial banks operating in the country, the bad debts of six commercial banks stand at more than four percent. The state-owned Agriculture Development Bank Limited has bad debts of 5.33 percent.
Kumari Bank with bad debt of 4.89 percent is second in the list. In the review period last year, the bank had bad debt of 1.28 percent.
Likewise, the bad debt of Nepal Investment Mega Bank grew to 4.83 percent from 1.75 percent and that of Laxmi Sunrise Bank increased to 4.69 percent from 1.72 percent. Himalayan Bank had its ratio increased to 4.67 percent, while Global IME Bank with the ratio of 4.38 percent also deteriorated in its financial performance.
The ratio of bad debt of Citizens Bank was 3.97 percent, Prabhu Bank 3.97 percent, Nepal Bank 3.84 percent, Prime Commercial Bank 3.67 percent, Rastriya Banijya Bank 3.62 percent and Siddhartha Bank 3.44 percent. The bad debt of Nabil Bank also increased to 3.69 percent from 2.33 percent.
NMB Bank, Machhapuchchhre Bank, Nepal SBI Bank, Sanima Bank, NIC ASIA Bank, Standard Chartered Bank and Everest Bank had their bad debts at less than three percent. However, these banks also had the bad debt increase by a notable percentage.
Everest Bank alone had its bad debt at less than one percent.
