Liquidity crunch has started fuelling the banks interest rates that were till last year hovering around and below five per cent.
"A huge amount of money is going to be invested in mega projects like Upper Tamakoshi soon and the banking sector will feel the heat," said Kishore Maharjan, chief executive officer (CEO) of Sunrise Bank -- the 23rd commercial bank.
Maharjan also forecast liquidity crunch in six to eight months. "We believe that in six to eight months, there will be a massive liquidity crunch in the market," he said adding that Sunrise Bank has, targetting the coming critical period, launched a fixed deposit product Sunrise Nava Barsha 2066 Muddati Patra that gives nine per cent interest per annum.
Though the established commercial banks are in comfortable position, new banks may have to face a critical situation if they do not plan ahead. "The days of following institutional depositors in a cut-throat competition offering them highest rate at the cost of individual customers are gone," Maharjan added. The institutional depositors like Citizen Investment Trust, Beema Sansthan, Employees Profident Fund are investing their money in Upper Tamakoshi forcing the commercial banks to go to general public.
Thus Sunrise is targetting individual depositors who are getting low interest rates on their hard-earned money, according to Maharjan who said that Sunrise will float 3.75 million-unit primary shares worth Rs 375 million.
Targetting the share investors, the bank has also brought another new savings product called Share Lagaani Khata offering 6.75 per cent interest per annum.
The recent heavy withdrawal from commercial banks due to the government's fears has also compelled banks to increase the interest rates.