Nepal Rastra Bank Announces Issuance of 10 Billion Rupees in Development Bonds

Nepal Rastra Bank (NRB) has unveiled plans to launch a substantial issuance of development bonds worth NPR 10 billion. Set to take place on Sunday, the issuance will see the introduction of the six-year development bond labeled ‘Ja’ for the fiscal year 2085/86 BS. This strategic move by the central bank aims to channel domestic credit towards the government’s developmental initiatives.

The scope of participation in this endeavor extends widely, encompassing a diverse array of entities. Banks, financial institutions, non-bank financial entities, insurance companies, organized institutions, and even individual citizens are eligible to invest in the development bond. Notably, the interest rate for this particular bond will be determined through a process of negotiation, as outlined by the NRB.

The development bond holds the flexibility of being utilized as collateral for acquiring loans. With interest payments disbursed bi-annually, the principal repayment for this bond is slated for Bhadra 11, 2086 BS.

Individuals and organizations seeking to acquire these bonds will engage in the process through competitive or non-competitive bidding. It’s worth noting that commercial banks, development banks, and finance companies licensed by the central bank will not be eligible to partake as competitors in the bidding process. Furthermore, the secondary market trading of this bond will be exclusively facilitated through the Nepal Stock Exchange Limited.

The issuance of these development bonds underscores the government’s commitment to fostering economic growth and infrastructure development. By tapping into the collective resources of various financial entities and individuals, this initiative aligns with the country’s broader developmental goals.

As the curtain rises on the issuance of the ‘Ja’ development bond, Nepal Rastra Bank takes a proactive step in fostering collaboration between the public and private sectors, setting the stage for a dynamic period of financial engagement and national progress.