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Nepal has sent an official diplomatic note stating that the 10-point labor standards sent by Malaysia are invalid.

The letter prepared by the Ministry of Labor, Employment and Social Security was sent to Malaysia through the Ministry of Foreign Affairs via the Nepali Embassy in Kuala Lumpur.

Concluding that the letter sent by Malaysia is an attempt to implement a syndicate system among manpower entrepreneurs, Nepal has made it clear that it is impossible to implement the standards.

According to the Nepal government, the standards are unacceptable as they affect equal opportunities, transparency and fair competition of foreign employment agencies registered in Nepal.

Malaysia had issued a 10-point criteria for the selection of manpower companies for Nepal, India, Bangladesh, Pakistan and Myanmar on Oct 27. 

The Nepal Stock Exchange (NEPSE) plunged by 4. 15 points to close at 4, 561. 94 points on Monday.

Similarly, the sensitive index dropped by 1. 05 points to close at 444. 56 points.

A total of 8,647,889-unit shares of 327 companies were traded for Rs 4. 51 billion.

Meanwhile, Daramkhola Hydro Energy Limited (DHEL) was the top gainer today with its price surging by 9. 99 percent.

Likewise, Unnati Sahakarya Laghubitta Bittiya Sanstha Limited (USLB)was the top loser as its price fell by 10. 00 percent.

At the end of the day, the total market capitalization stood at Rs 1. 45 trillion.

The price of gold has increased by Rs 2, 900 per tola in the domestic market on Monday.

According to the Federation of Nepal Gold and Silver Dealers’ Association, the precious yellow metal is being traded at Rs 241, 500 per tola today.

Similarly, the silver is being traded at Rs 3, 065 per tola today.

The non-performing loans (NPL) of commercial banks surged to 4.86 percent of total lending in the first quarter of the fiscal year, reflecting growing stress in the banking sector amid sluggish economic activity and weak loan recovery.

NPL levels of nine banks have crossed five percent—a level considered concerning by industry standards. Himalayan Bank had the highest NPL of 7.39 percent at the end of first quarter. NIC Asia (6.99 percent), Kumari (6.98 percent), Nepal Investment Mega (6.63 percent), Prime Commercial (5.86 percent), Prabhu (5.78 percent), Nepal Bank (5.49 percent), Laxmi Sunrise (5.42 percent) are the other banks with NPL levels exceeding five percent of their total lending.

Everest Bank Ltd has a lowest NPL level of just 0.74 percent.  The unaudited financial results of the review quarter of 20 commercial banks shows 14 reported a rise in bad loans,  while only five managed to reduce their NPL ratio. One bank’s NPL level remained unchanged. 

The average NPL ratio stood at 4.44 percent at the end of the previous fiscal year in mid-July, when only three banks had bad loans above five percent. The deterioration in banks’ asset quality over the past three months signals the increasing difficulty that borrowers are facing in servicing debts.

Bankers attribute the rise in NPLs to reduced business confidence and the temporary disruption in credit and repayment activities due to the GenZ protests on September 8 and 9 when several industries and business houses were targeted.

Under Nepal Rastra Bank’s regulations, loans overdue for less than three months are categorized as performing, while those overdue for more than three months are classified as substandard, doubtful, or bad, depending on the duration of default. Banks are required to maintain higher loan-loss provisions for these categories. High provisioning has been affecting profitability of commercial banks in recent months.

The International Monetary Fund (IMF) has questioned the accuracy of NPL figures reported by banks, suspecting that some banks may have engaged in “evergreening”—the practice of issuing new loans to repay old ones to mask defaults. It set an independent audit of Nepali commercial banks as a condition for the Extended Credit Facility (ECF). As per the government’s commitment, Nepal Rastra Bank (NRB) has hired a Bangladeshi firm for the portfolio review of 10 largest commercial banks in the country.
Despite improved liquidity and a decline in interest rates, rising NPLs suggest that credit risks remain high and that banks may need to tighten their lending and recovery strategies to safeguard balance sheet stability.