NRB Preparing to Raise NPR 40 Billion

Nepal Rastra Bank (NRB) has announced it will withdraw NPR 40 billion from the banking system on Wednesday to manage excess liquidity in the market. The central bank is taking this step as part of its monetary control measures.

The funds will be collected through a 63-day deposit collection auction, scheduled for 3 PM today. Interested banks and financial institutions can bid for a minimum of NPR 1 billion (10 crores), in multiples of NPR 50 million (5 crores). The repayment, including interest, is scheduled for Bhadra 25 .

The interest rate for the auction will be determined through competitive bidding. NRB will allow multi-rate bidding as well. Only ‘A’, ‘B’, and ‘C’ class licensed banks and financial institutions are eligible to participate in the auction.

Participants must specify both the amount they wish to deposit and the interest rate (up to four decimal places) in their bid. While allocating the total called amount, NRB will give first priority to bids offering the lowest interest rates and proceed accordingly.

This move is expected to absorb surplus liquidity from the financial system and support monetary stability.