KATHMANDU:
The cash-flush financial institutions offered almost Rs 50 billion to the central bank during the eighth round of the reverse repo.
Financial institutions bid for securities worth Rs 48.49 billion during Nepal Rastra Bank (NRB)’s latest bout of reverse repo held today. NRB issued reverse repo worth Rs 19.5 billion today to mop up excess liquidity from the financial system.
“The weighted average reverse repo rate for this round stood at 0.5587 per cent,” pointed out an official at the central bank. Financial institutions lend to the central bank against the collateral of government securities by bidding certain rates, during a reverse repo. As of this week, commercial banks alone have about Rs 65 billion which can be lent to viable projects.
This is the eighth time that NRB has launched the liquidity absorbing instrument since September 2013. Likewise, this is the third time that the central bank has issued such a large amount of reverse repo. However, the rate has always been below one per cent.
Since September, the central bank has mopped up funds worth Rs 126.5 billion from the market also through instruments such as outright sale auction for securities worth Rs 8.5 billion and development bonds worth Rs 10 billion.
The cash-flush financial institutions offered almost Rs 50 billion to the central bank during the eighth round of the reverse repo.
Financial institutions bid for securities worth Rs 48.49 billion during Nepal Rastra Bank (NRB)’s latest bout of reverse repo held today. NRB issued reverse repo worth Rs 19.5 billion today to mop up excess liquidity from the financial system.
“The weighted average reverse repo rate for this round stood at 0.5587 per cent,” pointed out an official at the central bank. Financial institutions lend to the central bank against the collateral of government securities by bidding certain rates, during a reverse repo. As of this week, commercial banks alone have about Rs 65 billion which can be lent to viable projects.
This is the eighth time that NRB has launched the liquidity absorbing instrument since September 2013. Likewise, this is the third time that the central bank has issued such a large amount of reverse repo. However, the rate has always been below one per cent.
Since September, the central bank has mopped up funds worth Rs 126.5 billion from the market also through instruments such as outright sale auction for securities worth Rs 8.5 billion and development bonds worth Rs 10 billion.
Source: THT
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