DETERMINANTS OF BANK DEPOSIT GROWTH IN NEPALESE COMMERCIAL BANKS

Abstract

This study investigates the impact of bank specific and macroeconomic variables on the deposit growth of Nepalese commercial banks. This study based on descriptive and casual research design. Data from ten commercial banks over the period from 2011/12 to 2021/22 basis of random sampling method. In this study saving deposit growth, fixed deposit growth and current deposit growth are identified as the dependent variables, while the independent variables include SDIR, FDIR, NB, CA, MS and GDP. Descriptive analysis, correlation and regression analysis and t test have been conducted in this research. For the data analysis the statistical package for social science (SPSS-29) version have been employed. The correlation analysis shows that the saving interest rate, capital adequacy, consumer price index and gross domestic product have negative correlation with saving deposit growth while number of branch and money supply show a positive correlation. Fixed deposit interest rate, number of branches, capital adequacy and consumer price index have positive correlation with fixed deposit growth whereas money supply and gross domestic product have negative correlation. For current deposit growth, the number of branches and money supply have positive correlation while Capital adequacy, consumer price index and gross domestic product show a negative correlation.The multiple regression analysis reveals that saving deposit interest rate, no of branches, money supply have positive and statically significant impact, capital adequacy has negative and insignificant impact and consumer price index and gross domestic product have a negative and significant impact on saving deposit growth. Fixed deposit interest rate, no of branches, consumer price index, money supply and gross domestic product have negative and insignificant impact on fixed deposit growth but capital adequacy has negative and significant impact. For current deposit growth, the no of branches and money supply have a positive and insignificant impact, capital adequacy has negative and significant impact and consumer price index and gross domestic product have negative and insignificant impact.