Nepal Rastra Bank to collect Rs 30 billion deposit for 1 month
लगानी न्यूज
Kathmandu. Nepal Rastra Bank (NRB) has decided to collect deposits of Rs 30 billion for a period of one month. The central bank is going to collect this amount through a one-month deposit collection tool to manage excess liquidity in the market.
According to a notice made public by the Nepal Rastra Bank, the banks and financial institutions interested in participating in the bidding process have to submit their bids through the online bidding system (OBSS) of Nepal Rastra Bank by 3:00 pm today.TAG_OPEN_div_26
The interest rate for deposit collection will be determined by bidding. The principal and interest collected in this way will be paid on September 28, according to the Rastra Bank.
In the bid, the bank or financial institution will have to mention the amount they want to keep as a deposit and the interest rate demanded. While allocating the amount called for collection of deposits, the lowest interest rate mentioned in the bid will be given first priority. After that, gradually the bidders with higher interest rates will be allocated until the sum called for is fulfilled.
If the demand for more than the total amount issued at the same interest rate is higher, the bid will be allocated on the basis of pro-rata, according to the Rastra Bank. Only ‘A’, ‘B’ and ‘C’ class banks and financial institutions licensed by Nepal Rastra Bank will be allowed to participate in the bidding of deposit collection equipment.TAG_OPEN_div_20
The amount for the approved bid will be spent from the account of the concerned counterparty in the Nepal Rastra Bank. The amount will be deposited by opening a separate account for the collected deposits. The principal amount of the deposit will be deposited in the account of the concerned bank and financial institution with the interest fixed on the payment date.
According to the Rastra Bank, the deposit amount cannot be counted in the investment portfolio of the concerned bidder. However, it can be calculated in the mandatory liquidity ratio and statutory liquidity ratio (SLR) to be maintained as per the directives of the Nepal Rastra Bank.TAG_OPEN_div_16
} Similarly, the bidder concerned cannot be paid back the amount or made the premature payment before the expiry of the deposit collection instrument. The Rastra Bank has been exploiting liquidity from the market from time to time through deposit collection instruments with the aim of managing excess liquidity available in the banking system.
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