Nepal Rastra Bank has tightened the provision of credit loss to banks and financial institutions. Earlier, the credit loss provision was 1 percent, but now it has to be increased by 0.3 percent to 1.3 percent, according to Nepal Rastra Bank. This amendment has been made by revising the directive 2019 to the licensed institutions of class A, B and C on Monday.
In addition, the central bank has made an arrangement to extend the loan repayment period by one year by providing credit loss of 20 percent of the working capital and 10 percent of the term loan to the banks and financial institutions. The central bank has also extended the time for publishing financial reports by 15 days.
Earlier, it was mandatory to publish the report within 15 days of the end of the fiscal year, but now it will be made public by mid-August. In addition, the NRB has made an arrangement to reconcile the interest amount received by end of August with the account by mid-July last year. The same provision will be applicable in case of ‘D’ class financial institutions.
