KATHMANDU, Oct 14: Nepal’s commercial banks recorded a 7.32 percent increase in combined net profits during the first two months of Fiscal Year (FY) 2026/27, despite sluggish credit demand, excess liquidity and mounting concerns over bad loans.
According to the records with Nepal Rastra Bank (NRB), 20 commercial banks earned a total net profit of Rs 17.81 billion during the period between mid-July and mid-September, compared to Rs 16.59 billion during the same period last FY.
As per bankers, the profit growth was largely affected by their recovering outstanding loans, increased short-term investments and rising non-interest income. Expanding digital banking services, remittance inflows and increased import-related transactions also contributed to higher fee and commission earnings.
Nabil Bank recorded the highest net profit, earning Rs 1.80 billion during the review period. Its profit increased by 35.83 percent from Rs 1.33 billion in the corresponding period last FY.
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Global IME Bank ranked second with a profit of Rs 1.69 billion, up 4.07 percent. Nepal Investment Mega Bank followed with Rs 1.28 billion, marking a modest growth of 0.91 percent. The state-owned Rastriya Banijya Bank also performed strongly, recording a 25.31 percent rise in profit to Rs 1.11 billion.
Eight commercial banks crossed the Rs 1 billion profit mark during the two-month period. In addition to the above list, NMB Bank earned Rs 1.03 billion, Sanima Bank Rs 1.03 billion and Kumari Bank Rs 1.01 billion. However, Kumari Bank's profit declined by 4.01 percent in the review period.
In terms of percentage growth, Himalayan Bank led the sector, with its net profit surging 55.13 percent to Rs 575.1 million from Rs 370.7 million a year earlier. The bank has been working to improve its performance following challenges emerged in the aftermath of earlier mergers.
Sanima Bank recorded the second-highest growth among the banks, with its profit rising 42.15 percent to approximately Rs 1.02 billion. Rastriya Banijya Bank and Nabil Bank also posted substantial increases.
Everest Bank earned Rs 984.7 million, up 7.88 percent, while Prabhu Bank's profit rose 10.13 percent to Rs 744.5 million. Machhapuchchhre Bank and Nepal SBI Bank recorded growth of 8.17 percent and 17.33 percent, respectively.
Despite the sector's overall improvement, seven commercial banks experienced declining profits. Citizens Bank recorded the steepest fall, with earnings dropping 14.99 percent to Rs 474 million. Nepal Bank's profit declined 12.45 percent to Rs 737.9 million, while Standard Chartered Bank reported a 10 percent decrease to Rs 479 million.
Laxmi Sunrise Bank, Agricultural Development Bank and Siddhartha Bank also recorded declines of 8.36 percent, 6.33 percent and 0.99 percent in profits, respectively.
NIC Asia Bank posted only marginal profit growth of 0.79 percent, reaching Rs 499 million.
Bank profitability continues to face pressure from rising non-performing loans, higher provisioning requirements and shrinking interest rate spreads. Lower interest rates have reduced banks' net interest income, while weak demand for new loans has limited opportunities to deploy excess liquidity profitably, according to bankers.
