Nepal Rastra Bank (NRB) has decided to invest Rs 6.60 billion from its gratuity and pension fund in banks and financial institutions (BFIs).
Issuing a public notice, the central bank has invited eligible banks and financial institutions to submit applications stating the amount they seek and the interest rate they propose. The investment will be made for a period of one year, and applicants have been asked to submit their proposed interest rates by February 15.
According to the notice, NRB plans to invest Rs 5.28 billion in ‘A’ class commercial banks, Rs 990 million in ‘B’ class development banks, and Rs 330 million in ‘C’ class finance companies.
To qualify for the investment, banks and financial institutions must have been in operation for at least two years, maintained the prescribed minimum capital adequacy ratio, kept non-performing loans below eight percent of total loans and advances, and ensured that net non-performing loans do not exceed three percent.
In addition, NRB has announced plans to invest another Rs 1 billion from the Employee Security Fund in banks and financial institutions. For this one-year investment, Rs 800 million will be allocated to ‘A’ class commercial banks, Rs 150 million to ‘B’ class development banks, and Rs 50 million to finance companies.
Interested institutions have been requested to submit applications along with required documents and proposed interest rates by December 14.
