Kathmandu-According to unaudited financial statements published by commercial banks up to the second quarter of fiscal year 2025-26, mid January, the banking sector’s overall net profit increased by 11.51 percent compared to the same period of the previous fiscal year.

Although interest rates declined, credit expansion remained weaker than expected. Lower impairment charges, better control of operating expenses, and growth in non interest income supported the increase in overall profit. Pressure on profits at some banks indicates uneven recovery within the sector.

By mid January of the previous fiscal year, 20 commercial banks had earned a combined net profit of Rs 27.43 billion. In the same period of the current fiscal year, total net profit rose to Rs 30.59 billion.

During the review period, 11 out of 20 commercial banks recorded profit growth. The remaining banks saw profits decline or moved into losses. Profit growth in a majority of banks pushed overall banking system profit up by around 11.5 percent.

In the first six months of the current fiscal year, Nabil Bank Limited posted the highest net profit at Rs 4.75 billion. This is 46.71 percent higher than the same period last year. Global IME Bank followed with Rs 3.25 billion, Kumari Bank with Rs 2.72 billion, and Everest Bank with Rs 2.11 billion.

By mid January, Laxmi Sunrise Bank remained in loss. The bank reported a negative net profit of Rs 273.6 million, compared to a net profit of Rs 1.16 billion in the same period of the previous fiscal year.

Compared to the second quarter of the previous fiscal year, Kumari Bank’s profit surged by 886.50 percent in the same period of the current fiscal year. High impairment charges had suppressed profit last year. A sharp decline in these charges this year led to a strong turnaround.

Kumari Bank’s net profit increased from Rs 275.7 million in the first six months of the previous fiscal year to Rs 2.72 billion in the same period of the current fiscal year.

During the review period, Nepal Bank’s profit rose by 183.04 percent, Siddhartha Bank’s profit increased by 150.20 percent, and Rastriya Banijya Bank’s profit grew by 132.04 percent.

In contrast, Citizens Bank International recorded the sharpest decline in net profit at 45.78 percent. Profits also fell at Nepal Investment Mega Bank, Prabhu Bank, Agricultural Development Bank, and NIC Asia Bank.