Nepal Rastra Bank to issue Rs 25 billion one-year bond today

KATHMANDU: Nepal Rastra Bank (NRB) is set to issue a one-year “Nepal Rastra Bank Bond 2084” worth Rs 25 billion today.

According to a notice issued by the central bank’s Monetary Management Department, the bond will be issued through an online bidding system, with bids accepted until 3:00 pm. The interest rate will be determined through the bidding process.

The bond will mature on Ashar 19, 2084, with the principal repaid on the maturity date. Interest will be paid on a semi-annual basis.

NRB said bids can be submitted for a minimum of Rs 50 million and in multiples of Rs 50 million, up to the total issue size. The bond may also be used as collateral with the central bank and other banks and financial institutions.

Only NRB-licensed Class ‘A’, ‘B’ and ‘C’ banks and financial institutions (counterparties) are eligible to participate in the auction. The bonds will be allotted based on the interest rates accepted through the bidding process.

The approved bonds will be included in investors’ portfolios. While they will not qualify toward the Cash Reserve Ratio (CRR), they will be eligible for calculation under the Statutory Liquidity Ratio (SLR) and the Net Liquid Assets Ratio.