NRB Directives: Implementation Measures Unveiled for Second Quarter Monetary Policy Adjustments

The Nepal Rastra Bank (NRB) has issued directives today following the monetary policy review for the second quarter, announced on Magh 29, 2080.

One significant adjustment allows institutional fixed deposit interest rates to be set up to 1 percentage point lower than those for individual fixed deposits, effective from Chaitra 01, 2080.

The NRB has removed the bidding rate requirement of up to 0.5% for fixed deposits (domestic or foreign currency).

The Nepal Rastra Bank (NRB) has set criteria for claims in the regulatory retail portfolio, assigning a 75% risk weight to eligible claims based on orientation, product type, granularity, and low-value individual exposure.

Notably, the low-value individual exposure threshold has been increased to Rs. 20 million which was before Rs. 10 million, reflecting a strategic adjustment to accommodate larger exposures. Banks meeting all criteria except for granularity can still include their claims with a 100% risk weight, ensuring flexibility in the banking sector's risk management approach.