Before 1937 AD, the banking system didn’t exist in Nepal. It began with the establishment of Nepal Bank Limited (NBL) by Juddha Shumsher as the first ever commercial bank in our country. About 51% of it is owned by the government of Nepal and the remaining 49% is owned by the general public. For those who didn’t know, Ka Barga Banks are Class A banks, which for the most part are commercial banks.

What is a commercial bank?

A commercial bank serves the general public financially by providing various loan services, savings accounts, making deposits and so on whereas a central bank can do what a commercial bank does, for nations and even governments. A central bank is given the responsibility and authority to monetary policy which means that it is this bank which formulates rules and regulations for other banks to follow.

Picture credit: https://banksnepal.com/

Nepal Rastra Bank (NRB) is the central bank of Nepal, established in 1956 AD. All the banks in Nepal are controlled and operated by the rules set by Nepal Rastra Bank. There are four classes of banks in Nepal. They are Commercial Banks (Class A or Ka Barga), Development Banks (Class B or Kha Barga), Finance Companies (Class C or Ga Barga), and Micro Credits Development Banks(Class D or Gha Barga). There are 27 Class A banks currently, as per NRB. They have been listed below, along with their paid-up capital in crores:

Investopedia ranked these aforementioned Class A banks in terms of deposit and they’ve mentioned that this was based on the un-audited second quarterly report of the fiscal year 2077/78. This compilation makes it easier to understand how the present ranking has been for these commercial banks.  

1. NIC Asia Bank
2. Rastriya Banijya Bank
3. Global IME Bank
4. Nabil Bank
5. Nepal Investment Bank
6. Prabhu Bank
7. Siddhartha Bank
8. Everest Bank
9. Nepal Bank
10. Agricultural Development Bank
11. NMB Bank
12. Prime Commercial Bank
13. Himalayan Bank
14. Mega Bank
15. Kumari Bank
16. Machhapuchchhre Bank
17. Sanima Bank
18. Citizens Bank
19. Laxmi Bank
20. Nepal SBI Bank
21. Nepal Credit and Commerce Bank
22. Bank of Kathmandu
23. Sunrise Bank
24. Century Commercial Bank
25. Standard Chartered Bank
26. Civil Bank
27. Nepal Bangladesh Bank

Every bank has to submit its financial report to Nepal Rastra Bank. For this, they have to calculate their growth performance too. This is done based on organic and inorganic growth. At NIBL  Ace Capital states, organic growth is purely performance-oriented and is not influenced by mergers and acquisitions, which falls under a company’s corporate activities. Whereas, inorganic growth is calculated by the company’s growth chart influenced by these corporate activities.

Collectively this organic and inorganic growth is what shows the growth figure of a bank. It is collected every year and when this year’s progress exceeds the preceding year, that is when growth has been achieved. Hence, Year on Year growth figure and Quarterly growth rate is compared and assessed to calculate the bank’s growth rate.

So, these were the banks that fall under Class A or Ka Barga in the context of Nepal. These banks provide different types of loans as well, which we will tune into in another blog post. So stay tuned with us.

We hope this helped.