Kamana Sewa Bikas Bank Limited: Building a Resilient National Development Bank Through Prudence, Quality, and Digital Transformation

24th December 2025, Kathmandu

The banking sector in Nepal is currently witnessing a fascinating evolution where size is no longer the sole determinant of success. Among the national-level development banks, Kamana Sewa Bikas Bank Limited, or KSBBL, has carved out a distinct niche by prioritising a philosophy of quality over quantity. Since its inception, the bank has moved away from the traditional model of aggressive expansion, choosing instead to build a fortress of financial stability through disciplined management and a forward-thinking digital roadmap.

KSBBL Serving Digital Transformation

As we reach the final weeks of 2025, KSBBL stands as a model for how medium-sized financial institutions can survive and thrive in a volatile macroeconomic environment. This article provides a deep dive into the strategic DNA of Kamana Sewa, examining its financial health, its innovative PQR framework, and its journey toward becoming a digital leader in Nepal.

INSTITUTIONAL FOUNDATIONS AND THE PARTNER FOR PROGRESS VISION

Kamana Sewa Bikas Bank was founded on the belief that trust and consistency are the most valuable assets a bank can possess. Promoted by a group of highly respected business personalities and professionals with high integrity, the bank operates with a clear vision: To become a distinct national-level development bank by continuously delivering superior customer service and promoting stakeholder welfare. Its mission is captured in the simple but powerful phrase, ‘Your Partner for Progress’.

To achieve this, the bank follows a set of core values that prioritize excellence, customer focus, and business ethics. Unlike many of its competitors, Kamana Sewa has avoided the trap of volume-driven growth that often leads to a rise in bad debts. Instead, it has focused on creating a motivated workforce and reliable financial solutions. This culture is steered by a professional management team and an experienced Board of Directors who understand the unique nuances of the Nepali market.

OWNERSHIP STRUCTURE AND CAPITAL ADEQUACY

The bank maintains a balanced ownership structure that ensures both promoter commitment and public accountability. Promoters hold a 51 percent majority stake, while 49 percent of the shares belong to the general public. This structure provides the bank with a stable capital base while remaining responsive to the needs of its public shareholders.

As of the first quarter of the fiscal year 2082/83, which corresponds to late 2025, the bank’s capital structure is remarkably robust. Its authorized capital stands at 5 billion Nepalese Rupees, with a paid up capital of 3.51 billion Nepalese Rupees. More importantly, the bank has maintained a healthy capital adequacy ratio of 12.26 percent, which is comfortably above the regulatory requirements set by Nepal Rastra Bank. This capital cushion, which includes a total capital fund of 6.33 billion Nepalese Rupees, ensures that the bank is well protected against potential market shocks.

FINANCIAL PERFORMANCE STEADY GROWTH AMID MARKET CHALLENGES

The financial year 2024/25 has been a testament to the bank’s resilience. In the first quarter of the 2082/83 fiscal year, Kamana Sewa Bikas Bank reported a net profit of 197.60 million Nepalese Rupees. While the banking sector in Nepal has faced tight liquidity and a sluggish credit market, KSBBL has managed to maintain a positive trajectory.

Key financial indicators from the latest unaudited report include:

• Total Assets: 71.63 billion Nepalese Rupees
• Total Deposits: 63.78 billion Nepalese Rupees
• Loans and Advances: 53.45 billion Nepalese Rupees
• Credit to Deposit (CD) Ratio: 86.35 percent

These figures show that the bank is growing at a controlled and sustainable pace. The CD ratio indicates that the bank is utilizing its assets efficiently while staying within the regulatory limits of the central bank. Furthermore, the bank recently completed its 19th Annual General Meeting in October 2025, where it approved a total dividend of 15.7895 percent for its shareholders, consisting of 15 percent bonus shares and a small cash component for tax purposes. This payout reflects the management’s confidence in the bank’s long term earnings potential.

THE PQR STRATEGY A BLUEPRINT FOR RESILIENCE

Under the leadership of CEO Dinesh Thakali, Kamana Sewa has adopted a unique strategic framework known as PQR. This acronym stands for Prudence, Quality Business, and Result Orientation. This strategy is the cornerstone of the bank’s success in recent years.

Prudence refers to the bank’s cautious approach to lending and risk mitigation. In an era where Non-Performing Loans or NPLs are rising across the industry, Kamana Sewa has focused on responsible underwriting. Quality Business involves building long-term relationships with financially sound customers rather than simply chasing numbers. Finally, Result Orientation ensures that every decision made by the bank is data-driven and aimed at delivering tangible value to stakeholders.

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The effectiveness of this strategy is evident in the bank’s asset quality. While the Gross NPA stood at 4.41 percent as of late 2025, reflecting broader economic stress, the Net NPA was kept at a much lower 1.24 percent. This shows that the bank has maintained strong provisioning and is actively managing its delinquent accounts through restructuring and tighter monitoring.

DIGITAL TRANSFORMATION AND THE KS IMOBILE REVOLUTION

One of the most exciting areas of progress for Kamana Sewa is its digital transformation. The bank has transitioned from basic automation to a sophisticated, personalized banking experience. At the center of this effort is KS iMobile, an omnichannel digital product that offers a seamless experience across desktop and mobile devices.

Innovation at KSBBL goes beyond just an app. The bank has pioneered several first-in-class digital initiatives in the development bank sector:

• Robotic Process Automation: KSBBL uses RPA to streamline internal operations and reduce manual errors in back-office tasks.
• AI-Driven Chatbots: These tools provide 24/7 support for both employees and customers, ensuring that administrative and HR functions are faster and more efficient.
• Doorstep Banking Services: This is a standout feature where the bank uses POS enabled devices to bring premium banking services directly to the customer’s home or office. It is particularly beneficial for senior citizens, differently abled individuals, and busy entrepreneurs.

These investments in technology have not only improved the customer experience but have also significantly lowered the bank’s cost of operations.

EVOLUTION OF INTEREST RATES AND COST EFFICIENCY

A historical look at the bank’s interest rate structure shows a clear trend toward stability and efficiency. Back in the fiscal year 2074/75, the base rate was often above 11 percent, and interest rate spreads reached as high as 10.1 percent. This high-cost environment made it difficult for both the bank and its borrowers.

Fast forward to 2025, and the situation has improved dramatically. The base rate for Shrawan 2082 was reported at 6.89 percent, with the interest rate spread narrowing to a much more sustainable 4.36 percent. For depositors, the bank offers competitive rates, such as 4 percent for the Pragati Bachat Khata Platinum and up to 6 percent for long-term fixed deposits. For borrowers, personal term loans are available at fixed rates ranging from 7.99 percent to 9.99 percent, depending on the duration. This lower base rate environment is a reflection of the bank’s improved liquidity management and cost control measures.

SOCIO ECONOMIC IMPACT AND CORPORATE RESPONSIBILITY

Kamana Sewa Bikas Bank takes its role as a national development bank seriously. In 2025, the bank has been highly active in Corporate Social Responsibility or CSR initiatives that go beyond simple charity. During Global Money Week 2025, the bank conducted financial literacy programs across all seven provinces, reaching over 2,500 students. These programs focused on the importance of saving, personal budgeting, and the secure use of digital banking.

The bank also showed its resilience and community spirit following the social unrest of late 2024. Through its CSR initiatives, KSBBL provided essential computers, furniture, and equipment to several ward offices and police stations that had been damaged, helping them resume their vital services to the public. Furthermore, the bank has integrated sustainability into its daily operations by promoting paperless banking and eco-friendly practices across its 130-plus branch network.

CHALLENGES AND THE PATH FORWARD

Despite its successes, the road ahead for Kamana Sewa Bikas Bank is not without its hurdles. The bank must continue to navigate a sluggish credit market and the persistent threat of rising NPAs. Competition from large commercial banks, which often have deeper pockets for marketing and technology, remains a constant pressure.

However, the bank’s response is one of focus and discipline. By deepening its market presence in the retail and SME segments and leveraging AI based predictive analytics, KSBBL aims to stay ahead of the curve. The focus remains on quality lending and financial literacy, ensuring that every loan disbursed contributes to the productive capacity of the economy.

CONCLUSION: SUBSTANCE OVER SIZE

Kamana Sewa Bikas Bank Limited is a prime example of how a development bank can achieve national prominence without sacrificing its soul. By choosing substance over size, the bank has built a foundation of capital strength, digital innovation, and customer trust. Its journey from a local player to a resilient national powerhouse is a story of prudence and progress. As we look toward 2026, Kamana Sewa remains well-positioned to continue its mission as a partner for the progress of millions of Nepalese citizens.

For More: KSBBL Serving Digital Transformation