The Nepal Rastra Bank (NRB) has announced that it will withdraw NPR 110 billion today using its deposit collection instrument. This move comes as liquidity in banks and financial institutions has increased, giving them more funds available for lending. The withdrawal is planned for a period of 87 days.
Over the past three years, NRB has been regularly withdrawing money from the market twice a week—on Sundays and Wednesdays. A few weeks ago, there was a temporary pause in deposit collection issuance when the bank withdrew funds through treasury bills, but the regular twice-weekly withdrawals have since resumed.
According to NRB, banks and financial institutions willing to participate in the deposit collection can submit their online bids by 3:00 PM today. Only banks and financial institutions classified under categories ‘Ka’, ‘Kha’, and ‘Ga’ are eligible to participate. NRB has also stated that the deposit collection instruments purchased through this process can be used as collateral in other banks and financial institutions.
The NRB notification specifies that bids can be placed in multiples of NPR 50 million if the amount exceeds NPR 1 billion, with remaining amounts accepted as residual. Bidding will be conducted based on interest rates, and multiple-rate bidding is also allowed.
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