Kathmandu, October 9
Nepal Rastra Bank (NRB) has lifted the Rs 2.5 billion ceiling on share loans that banks could issue to individuals. The central bank announced the change through a new directive to banks and financial institutions.
The decision follows the implementation of recommendations made by the Capital Market Reform Task Force formed by former Finance Secretary Rameshwar Khanal. The directive also makes it easier for banks to engage in share trading.
Previously, banks were allowed to sell only up to 20 per cent of their primary capital investment in shares that had been held for more than one fiscal year. This restriction has now been removed.
Similarly, banks can now invest in the shares and debentures of listed companies for a period exceeding six months. Earlier, such investments were permitted only for durations longer than one year.
