Nepal Rastra Bank to Withdraw Rs 120 Billion from Market via Deposit Collection

Kathmandu. Nepal Rastra Bank (NRB) is set to collect deposits worth Rs 120 billion from the market. The central bank has invited bids to collect this amount for a period of 19 days. The central bank has been absorbing liquidity through deposit collection tools and standing deposit facilities to manage excess liquidity and interest rates in the financial system.

Only 'A', 'B', and 'C' class banks and financial institutions licensed by the Rastra Bank are eligible to participate in the bidding. When allocating the long-term deposit collection amount, the central bank will prioritize bids with the lowest interest rates until the total invited amount is reached.

The bidding is being conducted today via an online purchase system, and the interest rate will be determined through the bidding process. The central bank stated that the principal and interest for this deposit collection tool will be paid on 2083 Baishakh 30. The minimum bid amount is Rs 100 million, and bids must be in multiples of Rs 50 million up to the total invited amount.

According to the central bank's open market operations procedures, if there is excess long-term liquidity in the financial market, the operations committee can use long-term deposit collection tools with a maximum maturity of 6 months to manage market interest rates. The central bank has been utilizing this provision frequently.