KATHMANDU, Aug 20: With excess liquidity in the market, Nepal Rastra Bank (NRB) mopped an additional Rs 30 billion from the banking system on Thursday.
Revised interest rate corridor system introduced
The NRB’s Monetary Management Department collected the amount for 25 days through the deposit collection auction mechanism. Only Banks and Financial Institutions (BFIs) licensed as “A,” “B,” and “C” class by NRB were eligible to participate in the deposit collection auction. The auction must be conducted based on the interest rate.
When distributing the amount collected through the deposit auction, the central bank gives first priority to the lowest interest rate bid and allocates sequentially until the total offered amount is reached. According to the NRB, the principal and interest of the deposit will be repaid on September 14.
