Kathmandu. KATHMANDU: Nepal Rastra Bank (NRB) is to collect deposits worth Rs 35 billion from banks and financial institutions (BFIs) for six months. Issuing a notice on Wednesday, the central bank said that it will start bidding and issuing deposit collection instruments for a period of 180 days.

The bidding process will start till 3:00 pm today through online bidding system software. The date of issuance of the deposit collection equipment has also been fixed today.

The interest rate of the deposit will be determined by the bidding. The principal and interest will be paid on February 13. The bidders can bid up to a minimum of Rs 10 crore and then Rs 10 crore.

Only the ‘A’, ‘B’ and ‘C’ class banks and financial institutions licensed by the Nepal Rastra Bank are allowed to participate in the bidding. You have to mention the amount you want to deposit and the interest rate in the bidding.

According to the NRB, the lowest interest rate will be given first priority while allocating the sum called. If the total amount issued is more than the total amount of the bid with the same interest rate, the allocation will be done on ‘pro-rata’ basis.

The Open Market Transaction Operation Committee of the Rastra Bank shall have the right to accept or reject the bid of all or part of the amount called.

The amount will be spent from the account of the concerned bank and financial institution in the Rastra Bank and deposited in a separate account of the deposit. If there is not sufficient stock in the account of the approved bank or financial institution on the day of issuance, such institution will be blacklisted and barred from participating in the next bidding.

The deposit amount with interest will be deposited in the account of the concerned bank in the Rastra Bank on the payment date of deposit collection.

Nepal Rastra Bank (NRB) has stated that the amount collected from deposits can be counted as the investment portfolio of the concerned bidder but cannot be counted in the mandatory cash reserve (CRR). However, the legal liquidity ratio (SLR) and liquidity ratio to be maintained as per the directive of the Nepal Rastra Bank can be calculated.