Deposit collection at BFIs increase by 3.8 per cent

BOP

Kathmandu: Deposits at Banks and Financial Institutions (BFIs) increased 3.8 per cent in the first three months of the current fiscal year.

On year-on-year (y-o-y) basis, deposits at BFIs expanded 14 per cent in mid-October 2017. Out of the total deposits at the BFIs, the share of demand deposits decreased from 8.7 per cent to 8.3 per cent and saving deposits from 44.1 per cent to 36.1 per cent in mid-October 2017 from the level of a year ago.

However, the share of fixed deposits increased to 42.5 per cent from 29.9 per cent in the review period.

Credit to the private sector from BFIs increased 4.6 per cent in the review period compared to a rise of 4.2 per cent in the corresponding period of the previous year.

In the review period, private sector credit from commercial banks, development banks and finance companies increased by 4.2 per cent, 8.3 per cent and 1.9 per cent respectively.

On y-o-y basis, credit to the private sector from BFIs increased by 18.7 per cent in mid-October 2017.

Of the total outstanding credit of BFIs, 61 per cent is against the collateral of land and building and 14.5 per cent against the collateral of current assets (such as agricultural and non-agricultural products).

Trust receipt (T.R.) loan extended by commercial banks increased by 25.5 per cent (Rs. 16.44 billion) to Rs. 80.97 billion in the review period.

In the review period, hire purchase loan increased by 1.7 per cent and overdraft loan rose by 2.9 per cent. Similarly, residential personal home loan (up to Rs. 15 million) increased 6.7 per cent and real estate loan 0.8 per cent.

In three months of 2017/18, the NRB mopped up Rs. 115.40 billion through open market operations. Of which, Rs. 40.65 billion was mopped up under deposit collection auction and Rs. 74.75 billion through reverse repo auction on a cumulative basis.

In the review period, the NRB injected net liquidity of Rs. 89.80 billion through the net purchase of USD 947.5 million from foreign exchange market.

The NRB purchased Indian currency (INR) equivalent to Rs. 97.49 billion through the sale of USD 900 million and Euro 40 million in the review period. INR equivalent to Rs. 107.59 billion was purchased through the sale of USD 900 million and Euro 95 million in the corresponding period of the previous year.