Kathmandu. Nepal Rastra Bank is continuously withdrawing money using deposit collection tools after excess liquidity accumulated in the banking system.
The central bank is going to withdraw Rs 40 billion from the banking system again today, Chaitra 30. The central bank is going to withdraw money from the banking system again today using deposit collection tools to manage excess liquidity. The National Bank has stated that the bidding for this will be held at 3 pm today.
Banks and financial institutions wishing to provide deposits can bid up to the total call amount, dividing it by a minimum of 100 million rupees and a maximum of 50 million rupees, leaving the remainder.
The bidding for deposit collection will be done at the interest rate, while multiple bidding can also be done at multiple interest rates, the National Bank has stated. Only banks and financial institutions of categories ‘A’, ‘B’ and ‘C’ will be allowed to participate in the bidding for the deposit collection instrument.
The NRB has stated that the principal and interest of this 21-day deposit collection instrument will be paid on Chaitra 24.
Liquidity in the banking system is fluctuating due to the lack of demand for credit recently. Banks and financial institutions are being forced to lend money to the central bank at an interest rate of around 3 percent.
