Dividend season has officially begun in Nepal’s banking sector, but a large number of commercial banks have yet to declare their payouts. As of now, only five of the 19 commercial banks listed on the Nepal Stock Exchange (NEPSE) have announced dividends from the last fiscal year’s profit, while 14 are still pending.
Traditionally, Ashoj and Kartik are considered dividend months in the stock market when listed companies reward shareholders based on their annual performance. However, this year’s announcements have been slower than expected. The first batch of dividend declarations came from Everest Bank, Sanima Bank, Siddhartha Bank, Citizens Bank International, and Machhapuchchhre Bank.
Four Banks Unlikely to Distribute Dividends
Among the 14 remaining banks, NIC Asia Bank, Himalayan Bank, Kumari Bank, and Nepal Bank are not in a position to distribute any dividend this year. Their distributable profits were negative based on audited financial reports for the last fiscal year. This means these institutions are expected to skip both cash and bonus share dividends.
Dividend Potential of Other Banks
While some banks are struggling, at least 10 banks still have the capacity to announce dividends, according to their distributable profit ratios (DPS%). Yet, recent trends show that many banks have proposed payouts lower than their actual capacity.
The table below compares dividend capacity (DPS%) and actual announced dividends among commercial banks:
| Bank Name | DPS (%) | Announced Dividend (%) | Bonus Share (%) | Cash Dividend (%) |
|---|---|---|---|---|
| Everest Bank | 38.27 | 20.00 | 6.00 | 14.00 |
| Sanima Bank | 20.47 | 7.3685 | 0.00 | 7.3685 |
| Siddhartha Bank | 13.22 | 10.53 | 5.00 | 5.53 |
| Citizens Bank International | 5.25 | 5.263 | 5.00 | 0.263 |
| Machhapuchchhre Bank | 9.23 | 8.00 | 4.00 | 4.00 |
| Standard Chartered Bank | 19.85 | — | — | — |
| Agriculture Development Bank | 18.42 | — | — | — |
| Nabil Bank | 17.64 | — | — | — |
| Prime Commercial Bank | 14.33 | — | — | — |
| Global IME Bank | 14.11 | — | — | — |
| Laxmi Sunrise Bank | 12.34 | — | — | — |
| Nepal SBI Bank | 11.29 | — | — | — |
| NMB Bank | 10.40 | — | — | — |
| Prabhu Bank | 4.44 | — | — | — |
| Nepal Investment Mega Bank | 1.44 | — | — | — |
| Nepal Bank | -3.06 | — | — | — |
| Kumari Bank | — | — | — | — |
| Himalayan Bank | — | — | — | — |
| NIC Asia Bank | — | — | — | — |
How Announced Dividends Compare
Everest Bank has been the most generous so far, announcing a 20% total dividend, which includes 6% bonus shares and 14% cash dividend. Despite having a dividend capacity of 38.27%, the bank opted to distribute almost half of what it could.
Sanima Bank had a strong capacity of 20.47%, yet only proposed a 7.3685% cash dividend, much lower than its potential.
Siddhartha Bank declared a total of 10.53%, including 5% bonus shares and 5.53% cash, compared to its 13.22% capacity.
Citizens Bank International proposed a 5.263% dividend, which closely matches its 5.25% capacity.
Machhapuchchhre Bank offered an 8% total dividend — 4% bonus shares and 4% cash — nearly equal to its 9.23% capacity.
What to Expect Next
For banks yet to announce, such as Standard Chartered, Nabil, Global IME, NMB, and Laxmi Sunrise, dividend capacities suggest potential payouts between 10% and 20% if they follow previous patterns. Investors are watching closely to see whether these banks will distribute dividends in line with their capacity or maintain a conservative approach.
In the past, commercial banks in Nepal have not always distributed dividends fully aligned with their financial capacity. Many tend to prioritize cash dividends over bonus shares, focusing on providing immediate returns to shareholders. This trend may continue this year as well.
Investor Outlook
Market analysts believe the slower pace of announcements may be linked to tighter profit margins, increased provisioning requirements, and regulatory scrutiny. The upcoming decisions by major banks like Nabil, Standard Chartered, and Global IME are likely to influence investor sentiment across the stock market.
With 10 commercial banks still pending announcements, investors remain hopeful that at least some will declare reasonable dividends within the season. The focus now lies on whether these banks distribute according to capacity or continue the cautious approach seen in recent years.
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