List of CEO name in Nepali Banking Industry
List of Chief Executive Officer in Nepali Bank The banking...
Base Rate of Commercial Bank in Nepal
Base rate is the minimum rate set by the central bank and banks are prohibited to allow loan below base rate. Banks charge certain premium on their base rate and it may differ from one bank to other. Base rate is determined and it’s components are as under
- Cost of funds (interest rate in deposit) = Correlation between cost of funds and base rate, high cost of funds increase base rate.
- Operating expenses= correlation between operating expenses and base rate, higher operating expenses( rent, equipment, inventory cost, payroll, advertising and other) increases base rate.
- Minimum rate of return
- Cost of CRR= high CRR tends to increase base rate
Implementation of base rate is for customers and initially before it’s implementation interest rate in loan account used to be fluctuation without informing customer and banks used to charge interest rate without any rules. But after implementation of base rate banks are not allowed to charge interest rate as they wish to. Regulator body gave them criteria to charge interest rate and banks need to charge interest rate so that interest spread would maintain. Base rate is subject to change quarterly.
For example: Mr. Ganga Bahadur takes loan of Rs.25,00,000.00 with BR+2% and it’s ending date estimated to be 15-05-2030 and BR( Base Rate) at the time was 8% and if BR of the banks increases tenor of the loan would increases and if BR of the banks decreases tenor of the loan would decreases.
Commercial Bank’s comparison of Base of as on Ashad 2076 and Ashad 2077
| SN | Name of Commercial Bank | Base Rate Ashad 2076 | Base Rate Ashad 2077 |
| 1) | Nepal Bank Ltd | 7.98% | 6.99% |
| 2) | Rastriya Banijya Bank Ltd | 5.50% | 5.80% |
| 3) | Agriculture Development Bank Ltd | 10.58% | 9.26% |
| 4) | Nabil Bank Ltd | 8.09% | 7.32% |
| 5) | Nepal Investment Bank Ltd | 8.33% | 7.51% |
| 6) | Standard Chartered Bank Nepal Ltd | 7.63% | 7.00% |
| 7) | Himalyan Bank Ltd | 9.05% | 8.38% |
| 8) | Nepal SBI Bank L td | 9.73% | 9.25% |
| 9) | Nepal Bangladesh Bank Ltd | 10.20% | 8.62% |
| 10) | Everest Bank Ltd | 8.12% | 7.48% |
| 11) | Kumari Bank Ltd | 10.82% | 10.08% |
| 12) | Laxmi Bank Ltd | 10.26% | 9.23% |
| 13) | Citizens Bank International Ltd | 10.52% | 9.04% |
| 14) | Prime Commercial Bank Ltd | 10.03% | 8.62% |
| 15) | Sunrise Bank Ltd | 10.32% | 8.95% |
| 16) | Mega Bank Ltd | 9.98% | 8.32% |
| 17) | Century Commerical Bank Ltd | 11.29% | 8.38% |
| 18) | Sanima Bank Ltd | 9.45% | 8.62% |
| 19) | Machhapuchhre Bank Ltd | 10.37% | 9.21% |
| 20) | NIC Asia Bank Ltd | 9.48% | 7.70% |
| 21) | Global IME Bank Ltd | 9.54% | 8.42% |
| 22) | NMB Bank Ltd | 9.86% | 8.95% |
| 23) | Prabhu Bank Ltd | 9.36% | 8.32% |
| 24) | Siddhartha Bank Ltd | 10.57% | 9.03% |
| 25) | Bank of Kathmandu Lumbini Ltd | 9.98% | 8.71% |
| 26) | Civil Bank Ltd | 11.11% | 9.84% |
| 27) | Nepal Credit and Commerce Bank | 10.23% | 9.03% |