Kathmandu, August 31
Flooding in Rasuwa on August 26 caused an estimated Rs 600 million in physical damage to branches in the affected areas, according to the Nepal Bankers’ Association.
The association said 16 branches of 12 banks were operating in the flood-affected areas. Of these, 15 branches were completely destroyed, while one sustained significant damage.
The affected branches had a combined 78,204 depositors.
The banks also had eight ATM counters in the affected areas. Nine ATMs held a total of Rs 11.663 million in cash, while Rs 172.4 million was kept in cash vaults and Rs 11.7 million at cash counters, according to the association.
Anil Sharma, chief executive officer of the Nepal Bankers’ Association, said the cash held in vaults, counters and ATMs was insured and therefore was not included in the estimated physical losses.
“The physical damage to branch offices, excluding cash, appears to be around Rs 600 million,” Sharma said.
He said banks also face a separate risk from loans extended in the affected areas, as much of the collateral against those loans consisted of land in areas hit by the flood.
“Banks had extended loans against land as collateral in the affected areas. Now there is a situation where the collateral itself may no longer exist,” Sharma said.
The affected branches had 2,125 borrowers, with banks having extended a combined Rs 2.43 billion in loans in the area, excluding lending to hydropower projects.
The branches held total deposits of Rs 4.5 billion.
Agricultural Development Bank suffered the largest reported damage among the affected banks. Its Trishuli branch was completely destroyed, while 64 locker boxes used by customers were also damaged.
The association said losses to property kept inside the lockers have not been included because banks do not insure customers’ locker contents and do not know what customers have stored inside them. Gold pledged as collateral for loans, however, is insured and has also not been counted among the banks’ losses.
Branches of Agricultural Development Bank, Citizens Bank, Global IME Bank, Himalayan Bank, Laxmi Sunrise Bank, Machhapuchchhre Bank, NMB Bank and Sanima Bank each suffered damage.
Prabhu Bank had two affected branches, while NIC Asia Bank and Nepal Investment Bank had three affected branches each.
Meanwhile, 26 bank employees remain unaccounted for following the floods, the association said. The employees have been reported missing after several bank branches in the affected areas were completely destroyed.
