Yet another NBA agreement violated and no punishment to the violators except caveat; Is the situation that bad or just habituated to break agreements?

The Nepal Bankers' Associations (NBA)'s agreement on interest rate fixation had been revoked a lot of times and the latest agreement was signed with the involvement of the Finance Minister and the Governor. According to the agreement the institutional deposit rate had been fixed at 8.5%, individual savings rate at 6% and Individual Fixed Deposit rate at 9.25%.

However, recently three commercial banks vis-à-vis NCC bank (NCC), Sunrise Bank (SRBL) and Century Commercial Bank (CCBL) published their interest rates in institutional deposits above 8.5%, which was clearly a violation of the agreed terms. The banks could publish as high as 8.5% and lend at a maximum of 9.5% but NCC and SRBL's published rate was 8.65%, which meant they could offer up to 9.65%. Similarly, CCBL published 8.99%, which meant they could offer up to 9.99% interest rate on institutional deposit.

Similarly, for the renewed institutional deposits, the banks can publish 0.1% higher interest rate i.e 8.6%.

Since the agreement had been broken, NBA summoned yet another meeting where majority banks were represented by their D-CEOs. All the representatives put their opinion forward some in favor of penalizing the violators and some against it.

In the end, they agreed to let the published 8.6% interest rates to be for the renewed deposits and not deposits with the aim to discourage the practice of snatching deposits amongst themselves.

They concluded on a note to abide by the agreement with the implied/informal agreement to outcast the bank that violates the agreement in interbank lending and forex transaction.