NRB Removes Rs. 25 Crore Cap on Share-Backed Loans, Eases Share Trading Rules for BFIs

Nepal Rastra Bank (NRB) has lifted the Rs. 25 crore ceiling on share-backed loans for individual borrowers, allowing them to obtain loans against their shares without any fixed upper limit. In a circular issued to banks and financial institutions, the central bank also introduced several policy relaxations aimed at enhancing liquidity and supporting the capital market.

Additionally, the restriction that allowed the sale of only up to 20 percent of core capital of BFI's from investments held for at least one year has been removed.

Provisions related to investments by corporate bodies in shares, debentures, and other instruments have also been made more flexible. Such investments are now allowed for a minimum holding period of six months instead of one year.