2 days left for the current fiscal year to end: Income not to be counted for 15 days, pressure on banking sector

३० असार २०८३, मंगलवार १८:०२July 14, 2026

. There are only two days left for the current fiscal year 2082/83 to end. Similarly, the provision of allowing the banks and financial institutions to count the principal and interest collected for 15 days after the end of the fiscal year in the income of the previous fiscal year has also ended.

The Nepal Rastra Bank (NRB), the central bank of Nepal, has not continued the provision that the interest collected for 15 days after the end of the fiscal year can be counted as the income of the previous fiscal year.TAG_OPEN_div_42

Prior to this, banks and financial institutions could also include the interest recovered till July 30 in the financial statements as interest income of the previous fiscal year.TAG_OPEN_div_40

According to this provision of the Rastra Bank, the banks and financial institutions were allowed to add the principal and interest collected till July 29 in the annual financial statement.TAG_OPEN_div_38 However, from the next fiscal year, banks and financial institutions will be allowed to keep the principal and interest collected till mid-July in their income, according to Sudha Shrestha, joint spokesperson of Nepal Rastra.

The Rastra Bank (NRB) had introduced this provision to manage the payment that is delayed by a few days due to procedural reasons at the end of the fiscal year.TAG_OPEN_div_36 According to a banker, this arrangement has made it easier for many banks to prepare annual financial statements.

He said that the interest received within the first two weeks of July can also be included in the income of the same year, which has not been raised until the end of July, so the profit and distributable profit will also improve.TAG_OPEN_div_34

This arrangement will have a direct impact on banks’ annual profits, dividend capacity, debt recovery strategy and financial statements, according to a banker.TAG_OPEN_div_32 “At present, the country’s economy is sluggish, economic activities have not fully improved. The banker says, “In such a situation, both the bank and the borrower will be under more pressure when this system is implemented.” According to sources, the NRB has removed this provision to make the financial statements more transparent, credible and in line with international accounting practices.

According to the NRB, the financial statements should reflect the true financial position of the bank. According to a source at the NRB, the provision has been removed due to the risk of artificially inflating the profit and weakening the accuracy of the financial statements if the income received after the end of the fiscal year is included in the income of the previous year.

According to bankers, the current economic situation is still challenging.TAG_OPEN_div_28 The activities of industry, trade and construction sectors have not been fully normalized. Even though many businessmen are regular borrowers, they are not able to manage the money till the last day of the financial year.

Banks have now instructed the branch office to the loan management department to expedite the recovery of dues. Banks are constantly contacting big corporate borrowers to small businessmen to pay installments and interest on time.

Interest income is the main source of income of banks.TAG_OPEN_div_24 The large amount of interest collected at the end of the financial year will now be transferred to the next financial year, which will have a direct impact on the net profit of the current year.

Bankers believe that due to the lack of good loan recovery, there will be problems in the management of bad loans of banks.TAG_OPEN_div_22 “After the withdrawal of the 15-day facility, banks are working on high priority to recover loans before mid-July. A banker said, “Special instructions have been given to the branches to raise loans at the last moment, while some banks have also mobilized separate recovery teams.” ’