Kathmandu. After the interest rates of banks have been continuously decreasing for a year, the base rate has also decreased. For this reason, the base rate of banks has also decreased by almost a third in a single year. By mid-2081 Poush, the average base rate of commercial banks has fallen to 6.71 percent. Which was 9.42 percent exactly a year ago.

Based on the unaudited (unaudited) financial statements published by the banks, the base rate has decreased by 271 basis points (2.71 percentage points) in the past one year.

Himalayan Bank has been at the forefront of reducing the base rate on a large scale. It has reduced the base rate by 329 basis points and Prime Commercial Bank by 326 basis points. Krishi Bikas, Kumari, NMB and Everest Bank have also reduced the base rate by more than 3 percentage points.

Similarly, Laxmi Sunrise, Nabil and Nepal Investment Mega Bank have also reduced costs by more than the average reduction (271 basis points). Some of these banks have already reduced the base rate significantly because they were previously using high interest rates, while some banks had sufficient deposits even before.

NIC Asia is at the bottom of the list of 11 banks that have reduced the base rate by a ratio lower than the average. But it has also managed to reduce its base rate by a difference of 216 basis points.

A year ago, the base rate of banks was between 7.5 and 10.5 percent. At that time, the highest base rate was 10.59 percent of Himalayan Bank, while the lowest was 7.56 percent of Standard Chartered Bank Nepal. The base rates of Prime Commercial and Kumari Bank were also above 10 percent.

But now the 'corridor' of this base rate has fallen to between 5 and 7.5 percent. Now the base rate of Chartered has fallen to 5.13 percent, while NIC Asia, which has the highest base rate, has also reduced it to 7.52 percent.

The base rate is the most important figure for calculating the interest rate of a loan. The interest rate is determined by adding a premium of a certain percentage point to this base rate. In this way, it is possible that those who borrow money from Standard Chartered will be able to get money at the cheapest interest rate.

After that, Rastriya Banijya Bank, Everest, Nepal Bank, Nabil, Nepal Investment Mega, Krishi Bikas, Sanima, NMB, Siddhartha, Global IME, Prabhu and Prime Bank seem to be gradually becoming more expensive. Those that charge even higher interest rates are Nepal SBI, Machhapuchhre, Kumari, Laxmi Sunrise, Citizens, Himalayan and NIC Asia.

Currently, the interest rate differential of most banks is close to the maximum limit (4 percent). However, Sanima, Siddhartha and Citizens seem to operate with a comparatively lower interest rate differential. Himalayan, Prabhu and Rastriya Banijya Bank have maintained an interest rate differential of 4 percent.

Now, when we look at these two figures together, it is again seen that Standard Chartered offers the cheapest interest rate and NIC Asia charges the highest interest rate. Between these two, Rastriya Banijya Bank and Everest Bank charge an interest rate of around 9.5 percent.

Nepal Bank, Sanima, Nabil, Nepal Investment Mega, Krishi Bikash, Siddhartha, NMB and Global IME Bank, when combined with the base rate and spread, remain between 10 and 11 percent. Apart from this, Prabhu, Citizens, Prime, Machhapuchhre, Nepal SBI, Kumari, Laxmi Sunrise, Himalayan and NIC Asia, when combined with the base rate, the spread reaches above 11 percent.