Deposit mobilization and interest rate in Nepalease commercial bank

Abstract

The study was conducted on deposit Mobilization and interest rate in Nepalese commercial bank. The main purpose of the study was to analysis structure of interest rate of commercial bank, analysis trend of deposit, investment, loan and advances of sample bank and compare impact of interest rate on deposit, investment and loan and advance of sample bank. The methodology of study was descriptive and analysis research design with five year data using means, standard deviation and coefficient of variation on deposit, advance, investment, interest, and spread rate. The data is analysed through excel software. The study was depends on sample banks out of 27 commercial banks, taken 6 commercial bank. They NBL, RBB, ADBL, SCB, EBL and PBL. The found of study was regression result of interest rate on deposit amount in positive relationship of interest rate with deposit, investment and loan amount. The slope coefficient of bank deposit is positively significant at 5 percent level which implies that banks interest rate increases with banks deposit amount. The regression result of commercial banks interest rate, Investment amount in specification shows a positive relationship between interest rate and Investment amount and the regression coefficient of firm size is statistically significant. The regression results of specification again establish the economic and statistical significance of deposit amount, loan and advance amount and investment amount. That means there was interest influences the deposit on various account, investment and loans amount are depends on interest rate of bank. So, the conclusion is interest rate affect the deposit, loan and advance and investment of banks in an economy.

Keywords: Interest rate of banks, deposit, investment