KATHMANDU

ICRA Nepal has reaffirmed the issuer rating of [ICRANP-IR] AAA to Standard Chartered Bank Nepal Limited (SCBNL) for the fifth consecutive year. The rating is considered to have the highest degree of safety regarding the timely servicing of financial obligations, such issuers carry the lowest credit risk.

In the rationale statement, ICRA Nepal states, ‘The rating reaffirmation factors in the bank’s sustained strong capitalisation profile with capital to risk weighted assets ratio (CRAR) of ~16% and tier-I capital of ~13% as of mid-January 2024 against the regulatory minimum of 11% and 8.5%, respectively. The rating also factors in the bank’s robust asset quality with reported gross non-performing loans (NPLs) of 1.60% as of mid-January 2024, which remains much lower as against the commercial banking industry average of 3.63%, despite the recent increase (NPLs were 0.72% as of mid-January 2023, when last rated).

The rating action also continues to factor in the bank’s long track record of operations (since 1987) and its strong parentage (~70% subsidiary of the Standard Chartered Group) along with the Group’s management/oversight support. The bank’s healthy deposit profile with relatively high share of low-cost deposits has resulted in the bank maintaining lowest cost of funds in the industry, which remains a major strength. The rating further continues to factor in SCBNL’s competitive positioning underpinned by its global brand reputation and competitive cost of funds.’

Nirvan Ghosh Dastidar, CEO of Standard Chartered Bank Nepal Limited, said, ‘The reaffirmation of AAA rating for five years in a row is a strong validation of our commitment towards our clients and all our stakeholders. We thank everyone for making this possible.’